As we look back on 2025, we started the year with cautious optimism, only to see confidence shaken by renewed geopolitical uncertainty in March. That disruption lingered, but as we close the year, confidence is returning. I believe we are on the cusp of the next cycle—and that’s exciting for what lies ahead.
 
Europe’s economy remains resilient, even if strong growth is still some way off. Geopolitics will continue to surprise us, but the level of uncertainty we saw in 2025 is unlikely to repeat.

On interest rates, arguments exist for both cuts and hikes in 2026. Our base view: monetary policy stays broadly neutral, with the ECB likely on hold. Inflation is near target, but cyclical forces pull it lower while structural factors push it higher, meaning all paths remain possible.
 
For occupiers, the hunt for quality space will intensify. Construction is slowing across Europe; logistics has seen more development, but vacancy will peak early in the year. Scarcity will keep upward pressure on prime rents and increasingly support rents beyond prime.

Liquidity is improving. Despite a slow mid-year, 2025 volumes will exceed 2024, and we expect another more than 10% increase in 2026. Importantly, this recovery won’t be sector-specific—capital markets activity will strengthen across the board.

 
Retail is another bright spot. Store openings broadened in 2025 and rental growth is spreading. This will give investors confidence to re-enter, attracting institutional capital and driving yield compression.

Office is no longer a dirty word. Occupiers continue to trade up for quality and location and early signs suggest strong performance in prime assets is spilling into the next tier. Brokers report yield compression in prime markets and we expect transaction evidence to follow in 2026.
 
Fund consolidation will also define 2026. Fragmentation in European living has limited scale and efficiency, impacting investor outcomes. Larger platforms offer clear advantages—better diversification, stronger governance and improved deal sourcing. Pan-European capabilities will be critical and consolidation will accelerate as institutional investors seek strategies combining resilience with scale.

We are ready to capture this next cycle with conviction. Our focus remains on sectors with structural growth drivers—living, logistics and select retail—while actively targeting office opportunities where quality and sustainability underpin demand. Scale and diversification are at the heart of our strategy, supported by pan-European capabilities that enable us to source deals efficiently and deliver operational excellence. 

As liquidity improves and confidence returns, we are prepared to deploy capital into assets that combine resilience with long-term value creation, ensuring our investors benefit from what’s next.