€154.4bn was invested in commercial real estate over the year, establishing 2024 as the start of market recovery with a +18% annual increase. 
 

The ECB has made significant progress in returning Eurozone inflation to the 2% target. This should allow the central bank to continue cutting interest rates until monetary policy reaches a neutral setting. 

Office investment volume at €40.4 billion has finally bottomed out. Logistics at €39.3 billion is the traditional sector recovering the fastest, with its market share comparable to offices, at around 25%. It is yet to be seen whether this will be a pivotal moment for market allocations. Retail at €33.7 billion is bouncing back rapidly at +23% and may grow further over 2025. Hotels (€20.5bn) became the leading sector by volume growth, expanding 70% y.o.y. 

Foreign capital accelerated by 24% to €70 billion, supported by a resurgence in American investment (+73% vs. 2023). European cross-border investment maintained the lead position at €30.3bn and grew by 19% compared to 2023.

Real estate is entering a new phase for pricing. Since Q4 2023 prime yields across all sectors have remained constant. Compression signals from some markets are evident, such as London and Paris at 4.00% (vs. 4.25% in Q3 2024).

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