European real estate markets are surging ahead with renewed strength, as fundraising activity across the continent increased by an impressive 50% year-on-year until September. This momentum is particularly strong in the UK, Germany, and France, which now top the list of cross-border real estate investment destinations, according to Colliers’ latest ‘Global Investor Outlook 2026’ report.
Investors See Europe’s Real Estate Market Rebound
After a challenging period marked by global uncertainties and rising costs, market fundamentals across Europe are showing marked improvement. Liquidity is returning, prices are normalizing, and investor confidence is on the rise. The Colliers report highlights that seven of the top ten cross-border real estate investment hotspots are now found in the EMEA region.
European investors are increasingly favoring direct investments, segregated accounts, joint ventures, and mergers & acquisitions. Private equity and secondary funds are not only backing asset-owning entities but also supporting active businesses in the sector, further fueling the capital inflow.
Strategy Shift: Core Asset Demand Outpaces Fund Supply
Interestingly, 37% of investors prefer ‘core’ and ‘core-plus’ strategies—those that target stable, income-generating properties—yet only 9% of currently fundraising real estate funds are focused on these investment styles. This disconnect is pushing investors to seek more flexible and agile investment structures, such as joint ventures and club deals, to align better with their strategic objectives.
Data Centers and Offices in Investor Spotlight
Asset-wise, data centers are seeing a spectacular rise, attracting 31% of global real estate fundraising in the first three quarters of the year—making them the second most sought-after asset class globally. There’s also a notable rebound in the office market, especially in key European cities like London, Paris, and Munich, where demand is picking up after a prolonged lull.
The industrial and logistics sector remains red-hot, drawing consistent investment interest across Germany, the Netherlands, and the UK. Meanwhile, retail assets—including supermarkets, proximity stores, high-street retail, and retail parks—are regaining favor for their stable revenue streams and relatively low development risks.
Boom in Living Assets and Value-Add Strategies
Within Europe’s living sector, appetite for multifamily residential and student accommodation assets is booming, particularly in the UK, Benelux, Germany, the Nordics, and Iberia, as institutional investors rush to fill persistent supply gaps. Italy is also emerging as a strong growth market for these asset types.
There’s a clear move towards value-creation strategies too: high construction and operating costs are motivating investors to convert and refurbish existing assets—especially office buildings—to meet upgraded sustainability standards and the evolving needs of modern tenants.
Looking Ahead: Optimism Mixed With Caution
Despite ongoing geopolitical and cost pressures, European real estate experts remain optimistic about the near future. As fundraising continues to accelerate and investor strategies evolve, Europe solidifies its status as a powerhouse of global real estate investment.
For more industry news and insights on European property markets, stay tuned to our updates.
