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Investments in the field of commercial properties began to relax from a two -year slump towards the end of 2024 when investors turned into sectors such as residential properties and continued to avoid office buildings.
In the second half, the recovery was driven and the value of the business completed in Europe last year was increased by € 4 percent to € 189 billion after falling 45 percent the previous year, MSCI said on Thursday. The results came a week after the data provider reported an increase in US investments by 9 percent.
The recovery was directed by investors who shifted their focus on hotels and apartments and brought more money into warehouses when they bet on the growth of the E -Commerce. Due to the hybrid work, the traditionally dominant office sector has a decline in investment by 10 percent, the worst year since 2009.
Chris Brett, head of the capital markets for Europe at Commercial Property Brokerage CBRE, said Residential property.
“Life will dominate (and) that will not change,” he said. “There is more intent to invest in 2025 than in 2024.”
Real estate contract culminated at the end of 2021, which was heated by low interest rates, even when Lockdowns clouded the prospects for offices. But it fell strongly in 2022 when the loan costs rose and real estate values were hammered.
According to the real estate analysts Green Street, prices have dropped by 38 percent all over Europe since the climax.
The feeling of office buildings was hit when landlords are exposed to large bills to improve old buildings, and through uncertainty about future demand. Analysts have also warned that the broader recovery could stall if interest rates remain increased longer than expected.
“The mood on the market is on the careful side of the optimistic side,” said Tom Leahy, head of the EMEA Real Assets Research at MSCI. “The latest volatility on the bond market has increased the possibility that interest rates will remain higher than expected.”
US private -equity groups were the largest buyers of Commercial real estateLed by Blackstone together with TPG, Starwood, KKR, Ares and Greystar.
Blackstones sale of A Luxury Milan retail block At the shopping centers of Liverpool One and Meadowhall in Great Britain in Liverpool One and Meadowhall as well as a contract for Elliott Management and Oval Real Estate to buy assets from Langham Estate in Central London, were among the largest offers in 2024.
This year has started with Abu Dhabis Modon, who agreed to buy half of Gic and British Land again Skery scratches in Broadgate.
Brett said the transaction was a “good shot in the arm for office development” and showed that London was still “the largest magnet for international capital in Europe”.
The volumes in the UK recovered by 26 percent in 2024, since a sharp correction of the assets increased the circumstances because the sellers were more willing to accept lower prices.
On the real estate market on both sides of the Atlantic, less needy loans and forced sales were recorded as many analysts that had predicted as banks to write off bad loans.
A New York Federal Reserve Paper published in October last year warned that this “extension and voting” approach “could slow down the redistribution of capital.
