Intelligent Investment
2024 European Investor Intentions Survey
February 5, 2024 10 Minute Read
.jpg)
Looking for a PDF of this content?
Executive Summary
CBRE’s 2024 European Investor Intentions Survey was conducted between November 6, 2023, and November 30, 2023. 888 Europe-based investors participated in the survey, which asked respondents a range of questions regarding their buying appetite and preferred strategies for sectors and markets in 2024.
Respondents indicated considerably stronger purchasing and selling expectations than the year prior and are optimistic that the investment market will return to pre-inflation surge levels in the near to medium-term. However, downward pressure on pricing and a degree of yield expansion is expected to continue in the immediate term. By the second half of 2024, these trends should start to reverse.
Investors are particularly attracted to value-add and opportunistic strategies as they search for higher returns in the current high interest rate environment. As sellers bring these types of assets to the market to generate capital, buyers with higher propensity for risk will increase their activity. Core and core-plus interest in residential and logistics also remains elevated for markets where stock is available. CBRE expects investment activity to increase in 2024, with most deal flow to occur in the second half of the year.
Key Findings
- Buying and selling expectations are higher in 2024 than in 2023. Smaller firms, generally comprised of developers and private investors are looking to undertake an aggressive strategy, while the larger institutional investors are willing to offload assets to generate capital.
- Investors expect market activity to increase in the second half of 2024 before fully recovering to the levels registered before the global surge in inflation by the end of 2025. Allocation to real estate remains stable and as risk-free rates drop, investor appetite for property will increase. However, the tightened debt lending market still presents a major challenge for European Investors.
- Repricing will continue across certain sectors in 2024, although to a much lesser extent than in 2023. Investors have indicated that logistics, residential, and hotel assets have almost fully repriced. High street retail is expected to remain resilient. Office assets, especially in the secondary segments, as well as shopping centres, may see continued movement in 2024.
- Value-add and opportunistic strategies are at the top of investors’ minds as they seek to capture yield. Concurrently, appetite for core and core-plus strategies is at its lowest level since the relaunch of our Investor Intentions Survey series in 2021. Residential and logistics have also surpassed office as the most sought-after sectors for investment for the first time.
- The UK retained its status as the market with the highest performance expectations, while Poland emerged as a highly sought-after market in 2024. Southern Europe has continued its resurgence, and German cities and Paris remain attractive.
- While sustainability factors have come under pressure in the current capital constrained environment, most respondents are willing to consider retrofitting existing assets to meet sustainability standards. Additionally, some investors are still prepared to pay a premium to acquire green compliant assets.
Read the full report for a detailed analysis of our findings.
Source: 2024 European Investor Intentions Survey, January 2024
* Only responses selecting markets outside of the country that each investment company is headquartered are taken into account.
Key Findings
- Buying and selling expectations are higher in 2024 than in 2023. Smaller firms typically show greater risk appetite, while the larger institutional investors are willing to offload assets to generate capital. Allocation to real estate remains stable and as risk-free rates drop, investor appetite for property will increase. However, the tightened debt lending market still presents a major challenge for European Investors.
- Investors expect market activity to increase in the second half of 2024 before fully recovering to the levels registered before the global surge in inflation by the end of 2025. Repricing will continue across certain sectors in 2024, although to a lesser extent than in 2023.
- Value-add and opportunistic strategies are on top of investors’ minds as they seek to capture yield. Concurrently, appetite for core and core-plus strategies is at its lowest level since the relaunch of our Investor Intentions Survey series in 2021. Residential and logistics have surpassed office as the most sought-after sectors for investment for the first time.
- The UK retained its status as the market with the highest performance expectations, while Poland emerged as a highly sought-after market in 2024. Southern Europe has continued its resurgence, and German cities and Paris remain attractive.
- While sustainability factors have come under pressure in the current capital constrained environment, most respondents are willing to consider retrofitting existing assets to meet sustainability standards. Additionally, some investors are still prepared to pay a premium to acquire sustainability-compliant assets.
Read the full report for a detailed analysis of our findings.
Survey Criteria
CBRE’s 2024 European Investor Intentions Survey was conducted between November 6, 2023, and November 30, 2023. 888 Europe-based investors participated in the survey, which asked respondents a range of questions regarding their buying appetite and preferred strategies for sectors and markets in 2024.
Related Insights
CBRE’s 2024 Asia Pacific Investor Intentions Survey was conducted in November and December 2023.
Investors cited higher-for-longer interest rates, tight credit conditions and differing buyer and seller expectations as the biggest impediments to commercial r...