EPRA CEO sees "cautious optimism" for Europe's property market

Dominique Moerenhout, CEO of the European Public Real Estate Association (EPRA), noted a sense of "cautious optimism" across the European property market at Expo Real 2025. 

This sentiment, consistent with EPRA's recent conference in Stockholm, suggests a shift towards viewing Europe's real estate prospects more positively.
However, this optimism was tempered for the German market, despite new stimulus packages, and the French market is currently struggling due to political uncertainty. The high attendance at Expo Real indicated the industry's eagerness to find signs of a turning point in the investment cycle, looking past current geopolitical instability.
Moerenhout observed a strategic shift among investors towards income-generating and high-yield assets, a result of market price adjustments over the past year and a half. He also noted a significant increase in North American investor presence, reinforcing the message that Europe offers an attractive entry point for capital, lower costs of capital, and diversification benefits.
Despite this interest, transaction volumes remain low, primarily focused on core and distressed assets. A broader recovery in other asset classes hinges on further market activity, with some sectors potentially requiring additional price adjustments.
Sector-wise, defence spending linked to industrial and storage assets was a prominent theme, necessitating adaptations in security and scale. While parts of the office sector continue to face challenges, retail is regaining investor interest, particularly retail parks and destination shopping centres. Data centres were a major talking point, with strong demand but supply constrained by electricity grid access. Other alternative real estate sectors like healthcare and student housing are experiencing strong momentum, especially within the listed sector.
Overall, there's an expectation of recovery for Europe's real estate market, contingent on greater clarity regarding US trade tariffs and improved macroeconomic and geopolitical stability. Moerenhout believes that the listed sector will be crucial for channeling investment from major international investors into Europe, with new IPO activity helping to provide the necessary scale and depth. 
He concluded by suggesting that conditions are gradually aligning for a better year in 2026, emphasizing the importance of patience.