The top 20 real estate management companies held about 789 billion U.S. dollars' worth of European assets under management as of December 2023. AXA Investment Managers was the company with the largest value of AUM, accounting for approximately 94 billion U.S. dollars in AUM.

In 2024, approximately ** percent of all property investments were allocated to the office sector, which was more than any other commercial real estate sector. Offices remain a large portion of European real estate investment, despite recent fluctuations in demand and vacancy rates. What decides an investment? Multiple factors play a role in an investor’s or developer’s decision to invest: availability of land or assets, construction costs, economic conditions, currency volatility, interest rate movements, and many others. While many investors specialize in a specific type of real estate, market demand also influences their choices. According to industry experts, among the main issues impacting investments were construction costs, availability of suitable assets/land, and European economic growth. European leaders in the real estate market In 2024, European investment in commercial property totaled almost *** billion euros. Four European countries exceeded *** billion euros in commercial property investment: the United Kingdom, Germany, France, and Sweden. Looking at individual European cities, London, Paris, and Madrid were the ones with the highest investment and development prospects on the real estate market for 2025.

The living sector, which includes multifamily and build-to-rent properties, was the most popular sector among investors in Europe in 2025. Nearly one-third of investors were planning to invest in residential properties in that year, followed by 27 percent targeting industrial and logistics.

The largest share of European real estate investors were interested in value-add assets in 2025. Value-add investors seek to boost performance through the active management of assets, the improvement of operations, renovation, and sometimes even the change of use. Approximately 35 percent of respondents planned to employ a value-add strategy, compared to 14 percent seeking core assets.

The value of retail real estate investment in Europe peaked in 2015, with the value of investment transactions reaching 68 billion euros. By 2023, the value of retail investments had reached 26 billion euros: the lowest figure in recent history. That is amid an overall cooldown in the European commercial real estate market. In 2023, the UK and Germany emerged as the most attractive countries for retail real estate capital, attracting more than half of the total value of investments into the asset class.

Data centers had the highest investment prospects among all sectors in the European real estate market in 2025, with a score of **** out of 5. Europe's main destinations for data center investments in Europe include London, Frankfurt, and Dublin: cities with a growing data center power capacity. New energy infrastructure and student housing ranked second and third with scores of **** and **** out of 5. At the other end of the scale were suburban offices with a score of **** out of 5.

In 2024, the value of commercial real estate investment in Europe recovered after falling by over 46 percent in 2023 reaching its lowest point in the timeline analyzed. The drastic decline was because of the soaring cost of debt and the uncertainty around property valuations. In 2023, the European commercial real estate sector attracted 133 billion euros in investment, while in 2024, this figure increased to 157 billion euros. The trend of falling property investment volumes affected all major commercial real estate markets in Europe.

In 2023, the value of investment in retail real estate investment in the United Kingdom (UK) amounted to 6.6 billion euros, roughly one fourth of the total investment in the sector in Europe. Overall, retail real estate investments have declined notably over the past decade, with 2023 measuring the lowest value on record.

This statistic shows the most popular real estate investment destination countries in Europe according to Asian and American investors, who gauged investment interest within upcoming 12 months as of June 2015. In that time, 53 percent of surveyed investors were interested in real estate investments on the German market. UK came second with 33 percent of investors indicating interest.

Foreign investment in the European property market declined substantially in 2023. In the second quarter of the year, the value of cross-border investments amounted to 18.23 billion U.S. dollars, down from 35.7 billion U.S. dollars in the same period a year ago. According to the source, the reason for the decline was the rising cost of capital, geopolitical tension, and uncertainty around monetary policy. North America was the largest foreign investor in the European property market, followed by the APAC region. In the same period, London, Milan, and Paris were the most attractive European markets for foreign investors.

In November 2023, there were eight real estate and investment companies trading on the stock exchange in Europe with revenue exceeding ten billion euros. Prologis Inc, which ranked eleventh with revenue worth over 7.21 billion euros, was the top real estate investment companies by market capitalization at over 93 billion euros as of November 20, 2023.

Asian and Pacific cross-border capital investment into the European real estate market in 2023 is expected to increase by a total of 26 percent of industry experts in Europe. On the other hand, about 26 percent expect the Asian and Pacific investments into European real estate to remain the same.

This statistics illustrates the main motivations for investing in real estate according to European property investors as of 2018. Responses are from the EMEA investor intentions survey, which provides a comprehensive look into the intentions and trends in the real estate investment sector in Europe, the Middle East and Africa. It can be seen that an asset class diversification was the most popular motivation for investment, with 28 percent of investors stating this at that time.

Multiple factors can play a role in the decision to invest in real estate. To calculate how prosperous European cities are on the estate market, the Urban Land Institute considered transport connectivity, forecasted real estate returns, a city’s economic performance, availability of assets/opportunities for new development, market size and liquidity, regulatory environment, digital connectivity, attractiveness to talent, city leadership, housing affordability, and affordability of space for new/small/growing businesses. Leading European cities for development and investment London, Madrid, and Paris were the three leading European cities by overall prospects for 2025. As the most important factors for selecting a European city for investment or development, industry experts outline forecast the city's economic performance. When it comes to the issues influencing real estate professionals in their investment choices, the major concerns shared were construction costs, capex requirements, and environmental sustainability requirements. Leading investment real estate sectors In terms of investment prospects, the sectors with the highest scores were new energy infrastructure, life sciences, and data centers. This should come as no surprise taking into consideration that the value of investments in industrial and logistic real estate in Europe has increased by more than threefold since 2012.

The value of retail real estate investments in European cities significantly decreased between the first half of 2020 and the first half of 2021. Germany had the largest retail real estate investment in Hamburg, Berlin, Munich, and Frankfurt for both years. The value of retail real estate investment in Germany reduced from about 973 million euros in 2020 to 602 million euros in 2021. Central Paris and Lisbon experienced the most significant reductions in retail real estate investments in that period.

In 2024, an increasing share of real estate industry experts in Europe shared that they intend to target slightly higher returns in 2025. Approximately 36 percent of respondents fell in this group, up from 25 percent in 2023's survey that explored return prospects for 2024. This finding shows an optimistic outlook for the sector.

The largest share of cross-border capital invested into real estate in Europe in the fourth quarter of 2022 came from within Europe. Out of the total European cross-border investment market worth approximately 13.6 billion U.S. dollars, European investors accounted for close to 21.3 billion U.S. dollars. The Americas region also had strong interest and reached 4.8 billion U.S. dollars.

The United Kingdom had the largest logistics real estate investment market in Europe in 2023. The value of investment allocated to industrial and logistics real estate in the UK was close to **** billion euros. Germany, which ranked second, recorded about *** billion euros in transaction value. Some of the cities with the highest warehouse rents were London, Oslo, and Helsinki.

Interest rates emerged as the biggest issue among real estate professionals in Europe in 2024. Approximately 86 percent of survey respondents chose interest rates as the most pressing challenge in the industry. Recent interest rates cuts by central banks show a promising outlook. That has translated into slight declines in mortgage interest rates, albeit at levels that are still notably higher than the long-term average. Inflation and construction costs and availability were other leading causes of concern.

In 2024, real estate investment trusts (REITs) and operators took the lead as the main investors in self-storage facilities across Europe. Real estate investment trusts and operators accounted for more than three-quarters of the total investment volume in self-storage facilities. The second position was held by private operators, who accounted for 12 percent of the investment volume. Additionally, private equity and money managers represented seven and four percent, respectively.