Multiple aspects can impact how and where investment is carried out. For 2022, real estate industry experts identified construction costs, the availability of suitable assets, increased government intervention, as well as sustainability as their main concerns for investing in the European real estate market.
Investment and development prospects in Europe
According to the survey, Berlin was the European city with the highest real estate investment and development prospects, followed by London and Paris in 2021. To calculate the scoring, the source took into account the following factors: transport connectivity, forecast real estate returns, city’s economic performance, availability of assets/opportunities for new development, market size and liquidity, regulatory environment, digital connectivity, attractiveness to talent, city leadership, housing affordability, affordability of space for new/small/growing businesses.
Investments and return
In the first half of 2021, the United Kingdom, Germany, and Sweden were the top three countries in Europe by total value of commercial real estate investment. In terms of profitability, the industrial and office real estate sectors in the United Kingdom are estimated to bring the highest returns between 2021 and 2025.
Issues impacting direct investment in European real estate in 2022, by level of effect
Characteristic
Very concerned
Somewhat concerned
Neither/nor
Not very concerned
Not at all concerned
Availability of suitable assets/land for acquisition and development
22%
44%
19%
11%
4%
Availabilty of (re)finance
5%
25%
25%
33%
12%
Sustainability/net zero
19%
42%
17%
19%
3%
Construction costs
41%
47%
5%
5%
2%
Covenant and loan servicing issues for existing loans
3%
16%
31%
36%
14%
Asset obsolescence
10%
40%
23%
20%
7%
Increased government intervention
19%
34%
23%
21%
3%
Need to evlove investment strategy to reflect a changing market
industry experts, including investors, fund managers, developers, property companies, lenders, brokers, advisers and consultants.
Method of interview
Face-to-face interview, online survey
Supplementary notes
Percentage points exceeding 100 percent are due to rounding. 844 property professionals completed surveys, were interviewed or took part in a series of roundtable meetings across Europe as a part of the research for this report.
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PwC, & Urban Land Institute. (November 4, 2021). Issues impacting direct investment in European real estate in 2022, by level of effect [Graph]. In Statista. Retrieved May 22, 2022, from https://www.statista.com/statistics/376877/europe-real-estate-investment-direct-issues-impacting-effect/
PwC, und Urban Land Institute. "Issues impacting direct investment in European real estate in 2022, by level of effect." Chart. November 4, 2021. Statista. Accessed May 22, 2022. https://www.statista.com/statistics/376877/europe-real-estate-investment-direct-issues-impacting-effect/
PwC, Urban Land Institute. (2021). Issues impacting direct investment in European real estate in 2022, by level of effect. Statista. Statista Inc.. Accessed: May 22, 2022. https://www.statista.com/statistics/376877/europe-real-estate-investment-direct-issues-impacting-effect/
PwC, and Urban Land Institute. "Issues Impacting Direct Investment in European Real Estate in 2022, by Level of Effect." Statista, Statista Inc., 4 Nov 2021, https://www.statista.com/statistics/376877/europe-real-estate-investment-direct-issues-impacting-effect/
PwC & Urban Land Institute, Issues impacting direct investment in European real estate in 2022, by level of effect Statista, https://www.statista.com/statistics/376877/europe-real-estate-investment-direct-issues-impacting-effect/ (last visited May 22, 2022)
