Grocery retail properties Europe’s stable investment anchor

While many traditional retail segments face challenges, grocery retail properties have emerged as one of Europe's most stable asset classes. 

GRR Basic Retail Report

However, the fifth GRR Basic Retail Report, from GRR Garbe Retail in collaboration with JLL, also shows that geopolitical instability, rising interest rates and energy costs, and ongoing inflation are altering revenue and operating expenses across various regions. A cross-border perspective reveals diverse national responses to these challenges. 
Despite these economic headwinds, the grocery retail sector remains strong, underpinned by consistent demand and stable, long-term leases. Meanwhile, rising energy costs, new regulations, and labour shortages are reshaping the market. Germany stands out for its efficiency and stability, while countries like Italy, Spain, the Netherlands, and Austria offer strategic growth opportunities due to less market consolidation. 
ESG criteria are no longer optional but are fundamental to professional asset management and investment decisions, significantly impacting property valuations and the broader European commercial real estate market. 
Andreas Freier, managing director of GRR Garbe Retail, said: "The strength of grocery-anchored properties in Europe lies in their cross-border social relevance, but also in their resilience. In a changing market environment, sustainability and energy efficiency, alongside location quality, are increasingly becoming crucial factors for long-term success and the focus of investment decisions. With this report, we aim to provide guidance and demonstrate that stability, sustainability, and returns are decisive in the European context."
Thomas Thein, head of Fund and Portfolio Management at GRR Garbe Retail, commented: “Our report aims to help investors assess and strategically leverage opportunities and risks in a European context.”
Sandra Ludwig, head of Retail Capital Markets at JLL, stated: “Retail food properties provide a stable foundation for institutional portfolios. Everyday consumer goods are indispensable, ensuring reliable demand and making the sector a valuable portfolio component, especially in volatile times. Successful investing requires comprehensive market knowledge and strategic acumen to optimally leverage the opportunities and unique characteristics of European markets,” 
Astrid Keller, senior ESG and research manager at GRR Garbe Retail, added: “Sustainability is no longer an add-on criterion, but an indispensable part of future-oriented investment strategies. Green leases are a key instrument for translating environmental responsibility into concrete, contractually enshrined measures. The ecological transformation of the European real estate market can only succeed if sustainability goals are implemented in a binding manner. ”