Property funds continue to deploy capital in European commercial real estate while their listed sector counterparts sell, according to DTZ.

In its European investment market update today, the agent said property funds were net-buyers in the second quarter of this year. The listed sector, meanwhile, is a net-seller, with its sale of retail properties in France and the UK, as well as office properties, behind the finding.

Property funds and third-party managed vehicles, DTZ said, spent €5bn in Q2, €1bn less than the record levels of the previous quarter, but almost in line with the unprecedented €4.7bn sold by the listed sector.

Institutional capital also contributed to the total €36.6bn commercial real estate investment activity in the quarter, with €2bn spent in Q2 as investor appetite moved beyond Germany and the UK to peripheral Europe, which posted across the first half of this year posted the biggest increase in investment.

“While the listed sector is selling out, we expect institutions to continue to be net-buyers,” DTZ investor research manager, Kasia Sielewicz said on a call. “This is on the back of increased activity by insurance companies.”

International capital – which DTZ classifies as the likes of Blackstone, CBRE Global Investors and LaSalle Investment Management – dominated the quarter, accounting for 46% of non-European investment. North American capital, from the likes of Canada Pension Plan Investment Board (CPPIB), Hines and Tishman Speyer, accounted for 20%.

Companies whose main activity is not property also increased their investment activity, spending €500m in the quarter and taking advantage of pricing in some areas to avoid leasing.

With core markets becoming expensive, DTZ said the lack of product could be an issue, with some investors needing to reassess their strategies and consider going higher up the risk curve.

Investors are becoming more confident in large ticket investments, the agent noted, with more portfolio deals. Driven by large retail portfolio sales in France and the UK, the amount of deals above €500m doubled in Q2.

DTZ revised its forecasts for 2014 investment volumes, predicting that €155bn would be spent this year and €165bn in 2015, putting the market back to levels last seen in 2005 and 2006.