European commercial real estate markets are showing renewed momentum, with investment volumes projected to reach approximately €52 billion in Q1 2026, marking a 6% year-on-year increase, according to research from Savills.
The data points to a market in gradual recovery, with full-year investment volumes forecast to rise by 16% in 2026 and a further 17% in 2027, signaling a sustained return of capital across sectors. Growth has been particularly strong in Finland, Ireland, and Poland, each expected to post increases of 50% or more compared to the same period last year. Meanwhile, Germany has returned to positive growth, and the United Kingdom continues to see steady expansion.
The first quarter of 2026 has also seen the re-emergence of large-scale and “trophy” transactions, including a €2.6 billion multi-country retail portfolio acquisition and several high-profile office, hospitality, and retail deals across major European cities. Sector activity remains broadly balanced, with multifamily and hospitality leading, alongside stable investment in retail, logistics, and office assets.
As capital returns and prime yields begin to compress, demand is increasingly focused on high-quality, well-located urban assets, particularly in central business districts and mixed-use environments.
At the same time, constrained development pipelines, low prime vacancy, and continued rental growth are tightening supply across key markets. With debt availability expected to improve and institutional allocations poised to rise, developers and investors are entering a window where early positioning in prime urban projects may yield outsized returns as the next cycle unfolds.
Read more at Europe Real Estate.