Investors are continuing to move into secondary assets and recovering markets as a way of accessing better returns, according to a new report.

Emerging Trends in Real Estate Europe 2015, published jointly by the Urban Land Institute (ULI) and PwC, found a surge in popularity for real estate investment opportunities in a number of cities that were hit particularly hard during the last market downturn.

Madrid was up 16 positions, Athens up 23 positions and Lisbon was up 17 positions. Birmingham rose 14 positions, while Amsterdam rose 17 positions.

Berlin replaced Munich as Europe’s top market for investment, viewed as less costly than other major German cities.

Competition for prime assets in Europe’s major real estate markets is, the report said, leading property investors to continue their move into secondary assets and recovering markets.

Lisette Van Doorn, chief executive of the ULI Europe, said that, as confidence has returned to global real estate markets over recent years, there has been a ”progressive movement up the risk curve”.

”Investors have found prime assets expensive and hard to source, and have in turn looked to find new opportunities in recovering secondary cities, secondary assets and development opportunities, as well as new or alternative real estate classes,” Van Doorn said, adding that the trend had been prevalent in the US for a few years and was first highlighted in last year’s report, when investors were looking at Ireland and Spain.

In spite of economic uncertainties in Europe, property remains a ”fertile ground” for investors, with 70% of investors expecting more equity and debt to flow into their markets this year.

The biggest problem investors are anticipating is a shortage of assets, the survey found, with challenges of regulation or the cost of finance also raised as issues.

A large majority of investors (82%) believe the availability of suitable assets will have a moderate or significant impact on their business this year.

As a result, real estate investors – armed with capital from sovereign wealth funds and pension funds from Asia and North America – are moving into less competitive environments, looking at secondary cities, secondary assets and development opportunities.