Portugal real estate investment surged to €1.23 billion in the first half of 2025, marking a 78% year-over-year increase. Discover how hotels and retail properties are driving this unprecedented growth and why Portugal is now a top destination for real estate investors.
The Portuguese real estate market is experiencing an impressive upswing in 2025, with total investment reaching €1.23 billion in the first half of the year—a remarkable 78% increase compared to the same period in 2024. According to the latest CBRE data, this growth signals not only a robust recovery but also highlights the dynamism of the sector, particularly in the retail and hospitality segments, which are driving the bulk of the activity.
Hotels and Retail: Key Drivers of Growth
For the third consecutive year, the hotel and retail sectors remain at the forefront of real estate investment in Portugal. Major commercial transactions, especially involving retail spaces and hospitality assets, have attracted both domestic and international investors. Improving financing conditions and greater liquidity in the market are empowering buyers and bolstering investor confidence in the country’s property sector.
Comparative Resurgence and Investor Confidence
The outstanding performance in H1 2025 is even more notable given the subdued market conditions of early 2024, when rising interest rates and economic uncertainty curbed investment flows. While those headwinds eased somewhat by the end of last year, it is the robust and competitive environment in 2025—marked by strong European demand and increased funding opportunities—that accounts for much of the present momentum.
International capital continues to be a pillar of Portugal’s real estate sector, comprising over three-quarters of the total investment in the past decade. This influx reflects Portugal’s growing stature as an open and desirable destination for global investors, putting it at the top of Europe’s hottest investment markets.
Positive Outlook and Market Diversification
Looking ahead, the outlook for Portugal’s real estate market remains highly optimistic. Recent surveys show that over 90% of investors plan to maintain or expand their acquisition activities in 2025, and CBRE’s initial forecast of €2.5 billion in total investment for the year may well be surpassed if current trends persist.
Moreover, secondary Portuguese cities are beginning to draw increasing attention from investors seeking new opportunities outside of established urban centers. This decentralization promises to foster more balanced national growth and extend the positive impacts of real estate investment to regions previously overlooked by major capital flows.
Emerging Opportunities Beyond Retail and Hospitality
While hotels and shopping centers maintain their dominant positions, other real estate segments—including logistics and build-to-rent residential projects—are gaining significant traction. Rising demand for logistics structures, fueled by new patterns of consumption and urban distribution, as well as ongoing interest in residential rentals, suggest a diversification of investment and the opening of new growth avenues.
A Safe and Profitable Investment Destination
Portugal’s real estate sector is firmly positioned for continued expansion, underpinned by sound economic fundamentals, stable financing conditions, and strong domestic and international investor demand. With macroeconomic stability and a favorable investment climate, Portugal is consolidating its reputation as one of Europe’s safest and most attractive real estate markets for both short-term gains and long-term profitability.
If you are considering expanding your investment portfolio in Europe, Portugal’s retail, hotel, logistics, and residential sectors in 2025 command particular attention—promising resilient returns and sustainable growth in a vibrant, competitive market.
