This retail resurgence is slowly spreading across the continent, as most markets have recorded annual increases in retail investment, with standout growth in Belgium (+241%), the Netherlands (+180%), Denmark (+135%), Portugal (+128%) and Finland (+114%).

Shopping centres have continued to regain popularity, with investment in the sector accounting for 30% of total retail volumes since the beginning of the year, up from 26% on the same period in 2024. This increase was largely driven by a rise in the number of larger transactions.

James Burke, Director, Global Cross Border Investment at Savills, says: “The fundamentals of the retail market are clearly improving, drawing a wider range of investors back into the sector. Falling vacancy rates, renewed rental growth, and a very limited pipeline of new developments are all strengthening income prospects. This more supportive environment is encouraging larger assets and portfolio transactions to come to market, which in turn is broadening participation from a range of different buyer groups.”

Lydia Brissy, Director, European Research at Savills, says: “Looking ahead, improving economic conditions and a stronger retail occupational market are expected to sustain investor appetite. Yield compression should remain gradual across Europe next year, with retail warehouses and high-street assets leading the way due to resilient tenant demand. Prime shopping centres are also set to benefit from growing institutional interest in large lot sizes, which should support liquidity and drive a slow but steady compression of yields in this segment.”