This figure is a 31% increase compared to the same period in 2023 and represents the highest quarterly volume recorded since the end of 2022.

The international real estate advisor believes that this, alongside improving investor sentiment, signals that the broad-based recovery of Europe’s real estate market is now well underway. For 2025, Savills forecasts that five themes will influence real estate discussions on the continent:

• The impact of global trade and political challenges on capital flows and real estate investment decisions
• Repositioning versus repurposing ‘obsolete’ buildings
• The implications of technological advancements on workforce dynamics and their impact on real estate demand
• Real estate's role in reshaping electrical power generation by exploring opportunities for the sector to contribute to energy independence and resilience
• The impact of extreme weather conditions on property and how innovative real estate can mitigate these challenges

Across all sectors, Savills foresees heightened interest in well-located assets ‘with work to do’ this year, particularly those offering opportunities for active management strategies such as repurposing or repositioning to align with ESG standards. Diversification will remain a priority for investors seeking to mitigate sector-specific risks, enabling all asset classes to benefit from the modest market recovery.

Lydia Brissy, Director, European Research at Savills, says: “The robust performance in the final quarter of last year is expected to bring annual investment volumes to approximately €174 billion, aligning closely with our €170 billion forecast and marking a 17% year-on-year increase. Looking ahead, total investment volumes are expected to reach €214 billion this year, which would equate to 23% year-on-year growth.”

James Burke, Director, Global Cross Border Investment at Savills, says: “Cross-border investment activity is also expected to increase this year, fuelled by a revival in intra-European capital flows and continued interest from North American investors. French SCPIs, as well as German, Israeli, and Spanish investors, are likely to remain active, particularly in Western European office markets. North American private equity firms, previously focused on London and Dublin office markets, may look at other cities in Europe offering rental growth and potential for yield compression.”