Ireland and Spain are close to record-breaking levels for commercial real estate (CRE) investment as buyers search for value in non-core markets, according to the latest research from advisor CBRE.

Ireland and Spain are close to record-breaking levels for commercial real estate (CRE) investment as buyers search for value in non-core markets, according to the latest research from advisor CBRE.

European CRE investment totalled €48.4 bn in Q3 2014 - a 27% increase on Q3 2013 and 4% higher than the previous quarter this year. Year-to-date total investment has reached €133 bn compared to €105 bn for the first three quarters of 2013, an uplift of 27%.

The performance of Irish and Spanish CRE investment markets was particularly impressive in Q3 2014. Ireland achieved its highest total ever this quarter with €1.6 bn, surpassing the previous high in Q3 2006 of €1.5 bn, and in Spain the €3.5 bn invested in Q3 2014 was the country’s second highest quarter on record.

CRE investment activity in other 'recovery' markets was also strong in Q3 2014, with the Netherlands (35%), Italy (40%) and Portugal (54%) all recording significant year-on-year increases.

The core markets of UK and Germany continue to show strong growth, with both countries recording increases of over 20% compared to both the previous quarter and Q3 2013. In both countries investors are increasingly active outside of the major centres – London and the 'Big-5' German cities – to the benefit of regional markets.

Commenting, Jonathan Hull, managing director of CBRE Capital Markets EMEA, said: 'Competition continues to be strong in core markets and, investors are increasingly willing to move up the risk curve, in terms of both destination and type of asset, in order to achieve value. Ireland and Spain in particular have benefitted by investors’ decisions to look beyond just the core markets and are set for record-breaking years in terms of investment activity.'

UK and Germany, where CRE investment has historically centred on London and the top five German cities, have seen a shift away from the core cities. In the UK the level of investment outside of London is now increasing much faster than in the capital. Similarly in Germany, investors have expanded their CRE investment criteria to include mid-size cities and class B locations in the Big-5.

Click on the link below for a PDF of the full CBRE report