According to Savills latest research, European real estate investment volumes are estimated to reach approximately €44.5bn in Q2 2024, an 18% increase on Q1 2024 figures. In terms of pricing this is the first time in nine months that average European yields have remained stable across all sectors.

Savills anticipates that the UK, Spain, Italy, Romania, the Czech Republic, Poland, Denmark and Norway will all record a year-on-year increase in investment volumes for H1 2024.

Marcus Lemli, CEO of Savills Germany and head of investment for Europe, says: “The market seems to be bottoming out both in terms of activity levels and pricing. Sectors such as multifamily, hospitality, and logistics continue to see stronger investor interest.

“Many investors operating internationally are seeking to take advantage of appealing pricing levels across different European jurisdictions. Consequently, we expect to see an increase in cross-border investment activity over the next 6-12 months.”

Lydia Brissy, Director European Research at Savills, says: “As expected, REITs are gradually increasing their activity. Attractive valuations and the growth of specific asset classes considered more defensive are benefiting REIT fund managers. Additionally, institutional investors are cautiously re-entering the market as interest rates decrease. Meanwhile, many cash-rich investors, Privates and sovereign wealth funds that do not rely on costly debt, continue to engage in smaller and medium-sized transactions.”

Alexandra Gomes, Head of Research, Savills Portugal, says: “With regard to Portugal, the preliminary closing results for the first half of 2024 indicate a more encouraging performance in the second quarter, with a rise of approximately 65% in total investment volume compared to the first quarter of 2024. In total, nearly 430 million euros were invested in this second quarter, contributing to an accumulated volume of approximately 690 million euros in Portugal for the first half of 2024. The ‘Savills World Research’ report, published in December 2023, had already anticipated that global real estate investment would increase in 2024, with Portugal emerging as one of the most sought-after destinations due to its tourism potential. This is evidenced by the hospitality sector accounting for 36% of the total investment volume in these first six months of the year. We believe that investor interest in this and other segments, particularly alternative investments, will continue through to the end of the year.”