Europe Commercial Real Estate Market to Reach USD 1.55 Trillion by 2025; Projected to Grow to USD 2.05 Trillion by 2030 on ESG Focus, Logistics, and Office Revival

Mordor Intelligence has published a new report on the Europe Commercial Real Estate Market, offering a comprehensive analysis of trends, growth drivers, and future projections.

Europe Commercial Real Estate Market Overview

Mordor Intelligence forecasts that the European commercial real estate market will reach USD 1.55 trillion by 2025 and rise to about USD 2.05 trillion by 2030, reflecting a 5.8 percent annual growth rate. This projection comes amid improved financing conditions, renewed investor enthusiasm, and growing interest in high-grade assets particularly logistics, offices, and mixed-use properties aligned with sustainability goals.

Report Overview: https://www.mordorintelligence.com/industry-reports/commercial-real-estate-market-in-europe

Key Trends

1. Return of Institutional Investment

Institutional capital from pension funds, sovereign wealth pools, and insurance companies is flowing back into European commercial real estate, favouring income-generating assets with reliable cash flows. These investors are targeting logistics hubs, green-certified offices, and mixed-use developments.

2. Logistics Leads Growth

Industrial and logistics properties are expanding fastest, driven by e-commerce and global supply chain adjustments. With investors shifting toward warehouse assets, the logistics sector is gaining a steadily larger share of overall investment.

3. Offices Rebounding in Key Cities

Prime office spaces in central European cities are seeing renewed attention. Tenants seek modern, sustainable buildings near transit, boosting demand in core urban business districts even as peripheral offices struggle.

4. Rise of ESG and Green Office Standards

European occupiers and investors are increasingly focused on energy-efficient, environmentally certified properties. Offices equipped with solar panels, EV charging, and eco-friendly design features are commanding premiums and drawing more capital.

5. Hybrid and Flexible Workspace Needs

Corporate and SME demand accounting for around 70% of market activity-is being shaped by hybrid work models. Providers of flexible office space and co-working hubs are benefiting from companies seeking adaptable leasing and smart-building amenities.

Market Segmentation

By Property Type

Offices: Held roughly 32% of the market in 2024. City centre offices are outperforming due to tenant preferences.

Logistics & Industrial: The fastest-growing segment with a targeted CAGR of about 7.1% through 2030.

Retail, Hotels, Mixed-Use: While facing challenges in some sectors, retail and hospitality are seeing renewed interest within mixed-use redevelopment.

By Business Model

Sales: Still accounts for the majority of transactions (~60%).

Rentals/Leases: Rising fastest with about a 6.2% annual increase as investors and occupiers lean toward rental income and flexible leasing options.

By End User

Corporate & SME Tenants: Represent 70% of activity, showing highest growth (~6.7%).

Public Sector & Investors: Demand for REITs, data centres, and logistics hubs is growing, thanks to policy support and income stability.

By Region

United Kingdom: Remains the dominant national market.

Germany: Largest share (~28%).

Central & Eastern Europe: Fastest regional growth, benefiting from nearshoring and infrastructure investments.

Southern Europe: Drawing capital through SEZ incentives and regional recovery efforts.

Explore Our Full Library of Commercial Real Estate Research Industry Reports - https://www.mordorintelligence.com/market-analysis/commercial-real-estate

Key Players

Europe's commercial real estate landscape blends global investors with regional specialists:

Blackstone Inc. - Large-scale investor in logistics, offices, and green buildings across Europe.

Covivio - Known for sustainable, flexible offices and residential projects.

Hines - Combines in-house development with a broad European footprint.

Strabag Group - Active in construction-driven projects across transport-oriented and mixed-use developments.

AG Real Estate, Futureal, Unibail-Rodamco-Westfield, SEGRO, Gecina, Landsec, Merlin Properties, Prologis Europe, Brookfield, Tishman Speyer, CA Immo, and HB Reavis round out a mixed field of national and pan-European players.

These firms are strong in areas like green-certified offices, build-to-rent, logistics warehouses, and transit-oriented developments, responding actively to funding flows and occupier demand.

Conclusion

The European commercial real estate market is growing steadily, supported by renewed investor interest, demand for sustainable buildings, and a strong logistics sector. Offices in key urban areas are regaining momentum, especially those offering energy efficiency and flexible layouts.

With a shift toward rental models and green-certified assets, the market is adapting to changing tenant needs and investment strategies. Backed by both global and local players, the sector is well-positioned for continued progress across core segments.

Industry Related Reports

Commercial Real Estate Market: The Report is structured into several key segments for detailed analysis. It is segmented by property type, covering offices, retail spaces, logistics facilities, and other commercial developments. The market is also classified by business model, distinguishing between sales and rental transactions. In terms of end-user, the report includes individuals or households, corporates, small and medium-sized enterprises (SMEs), and others. Geographically, the market is examined across major regions including North America, South America, Europe, Asia-Pacific, and the Middle East & Africa.

To know more visit this link: https://www.mordorintelligence.com/industry-reports/commercial-real-estate-market

Turkey Commercial Real Estate Market: The report covers the Commercial Real Estate Market in Turkey, segmented by property type which includes office, retail, industrial, logistics, hospitality, and multi-family developments and by key cities, namely Istanbul, Bursa, and Antalya.

To know more visit this link: https://www.mordorintelligence.com/industry-reports/commercial-real-estate-market-in-turkey

Egypt Commercial Real Estate Market: The report provides an analysis of the Commercial Real Estate Market in Egypt, segmented by property type-including offices, retail, industrial and logistics, hospitality, and multi-family-and by key cities such as Cairo, Alexandria, Giza, Port Said, along with the rest of the country.

To know more visit this link: https://www.mordorintelligence.com/industry-reports/commercial-real-estate-market-in-egypt

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