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Commercial real estate investment volume increases in Q1 2025
Living and retail investment markets in particular are driving growth
April 15, 2025
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In the first quarter of 2025, €2.3 billion was invested in commercial real estate, an increase of 12% compared to the investment volume in Q1 2024. Real estate advisor CBRE sees this as confirmation of the recovery that has been visible since the first quarter of 2024. Stable interest rates and confidence that the repricing is behind us are ensuring more active buyers on the market. So far, international tensions have not had a noticeable impact on investor sentiment in the Netherlands.
The increase in investment volume is mainly due to improved dynamics in the living investment market (+91%) and the retail market (+48%). In logistics real estate, volume declined by 33%, mainly due to less available supply as a result of lower expansion activity. This decline is unrelated to external market factors.
Living investment market picks up due to divestment strategy
In the first quarter of 2025, approximately €750 million in residential complexes were traded, of which 93% in existing construction. It is expected that approximately 95% of the total of 3,000 homes sold will end up on the market in the coming years via individual units.
More and more national and international private equity parties are applying this strategy, with national family offices buying individual residential complexes and international private equity parties focusing on larger residential portfolios. For the time being, the most recent policy changes announced by the ministry have no impact on these divestment strategies. However, they may have a positive effect on the feasibility of new construction projects in cities such as Amsterdam and Utrecht. Foreign investors remain cautious for the time being, partly due to corporate tax and high transfer tax. Investments mainly come from Dutch pension funds and insurers.
Office market sees recovery
After a few challenging years, there is movement visible again in the office market. The share in the total investment volume rose from 11.3% at the end of 2023 to 15.9%. The increase in Dutch family offices, French SCPIs and private equity parties, who are confident in the prospect of occupancy rates and rental growth, is mainly contributing to this recovery. As a result, liquidity is slowly returning to repriced offices.
The supply on the market is growing simultaneously, partly due to redemptions in office funds and buildings that are approaching the end of their investment horizon. This combination of supply and demand paves the way for further growth in the investment volume in the coming quarters. The expectation for this segment has therefore been revised upwards.
Growth in investment volume expected
CBRE expects further growth due to rental growth and value increases. Erik Langens, Managing Director at CBRE Netherlands: “It is not entirely clear yet what impact the geopolitical developments concerning import duties will have on the European real estate markets. For the time being, investor sentiment in the Netherlands remains surprisingly stable. We are still seeing a consistent number of interested parties in bidding processes. The value increases in various segments, driven by rental growth and an increasing number of active buyers, provide confidence. Additionally, we expect the European Central Bank (ECB) to announce a stronger decrease in interest rate, which could strengthen the investment climate more. If this trend continues, we expect the market dynamics to develop in the coming months.”
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate services and investment firm (based on 2024 revenue). The company has more than 140,000 employees (including Turner & Townsend employees) serving clients in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
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