European real estate investment to reach €95b in H1 2025

According to Savills, European real estate investment is projected to reach €95 billion in the first half of 2025, marking an 11% year-on-year increase. 

Lydia Brissy, director in Savills European commercial research team

Preliminary data indicates a resilient second quarter with transaction volumes near €50 billion, an 8% rise compared to the same period last year. 
The market experienced a temporary slowdown at the start of Q2, leading up to the US's "Liberation Day" as investors adopted a cautious approach. 
However, activity has since picked up, driven by new deals and portfolio entries, especially following President Trump's tariff announcements. 
PBSA is a highly sought-after asset class in Europe, with numerous large portfolio deals underway or nearing completion in countries like France, Spain, Italy, Ireland, and the Baltics. Strong occupier demand and investor interest in the living sector fuel this popularity, though limited supply in some markets presents a challenge.
Retail and hotel sectors are exceeding initial projections, with shopping centres and grocery-anchored retail performing well in countries like Spain, Ireland, the Netherlands, and Hungary. Hotels continue to attract investor interest, bolstered by a resurgence in tourism and a positive long-term outlook for leisure travel. The clearer post-pandemic landscape has reignited investor confidence in both sectors.
James Burke, director, Global Cross Border Investment at Savills, said: “The outlook for the European investment market in the second half of 2025 is cautiously positive. Despite ongoing geopolitical tensions, we anticipate a stronger second half of the year in most European countries. Encouraging signs include a growing number of sizeable assets and portfolios returning to the market, which appear to be attracting renewed interest from investors.”
Lydia Brissy, director in Savills European commercial research team, added: “Our forecasts remain largely unchanged from last quarter, with total European investment volumes projected to reach €222 billion by year-end, a 12% year-on-year increase. Growth is expected to be driven primarily by markets such as the Czech Republic, Finland, Denmark, the Netherlands, and Belgium. This modest recovery will be underpinned by continued macroeconomic stabilisation, ongoing price adjustments, and the progressive return of core capital to mainstream sectors.”