According to Savills' recent research, investment activity in European real estate has shown signs of recovery in Q2 2024, with increased investment volumes and stable prices.
Real estate investment in Europe is estimated to reach €44.5 bn in Q2, reflecting an 18% increase compared to Q1 2024.
For the first time in nine months, average yields across all European property sectors have remained stable.
The total investment volume for the first half of 2024 is projected to surpass €74 bn, which is roughly similar to the same period in 2023.
Several European countries are expected to see a year-on-year increase in investment activity during H1 2024, including the UK, Spain, Italy, Romania, the Czech Republic, Poland, Denmark, and Norway.
Marcus Lemli, CEO of Savills Germany and head of investment for Europe, said: ‘The market seems to be bottoming out both in terms of activity levels and pricing. Sectors such as multifamily, hospitality, and logistics continue to see stronger investor interest. Many investors operating internationally are seeking to take advantage of appealing pricing levels across different European jurisdictions. Consequently, we expect to see an increase in cross-border investment activity over the next 6-12 months.’
Lydia Brissy, director European Research at Savills, added: ‘As expected, REITs are gradually increasing their activity. Attractive valuations and the growth of specific asset classes considered more defensive are benefiting REIT fund managers. Additionally, institutional investors are cautiously re-entering the market as interest rates decrease. Meanwhile, many cash-rich investors, privates and sovereign wealth funds that do not rely on costly debt, continue to engage in smaller and medium-sized transactions.”
