AEW reports a positive outlook for prime European offices, and a further bifurcation in pricing between prime and secondary offices is expected to continue, according to the firm’s newly released European Annual Outlook for 2024, which examines the impact of the rapid and significant downward valuation movements during 2022 and 2023, and the prospect of a revival in 2024.
“While it may feel a bit surprising and premature to most investors, as many continue to grapple with valuation declines and refinancing challenges, we expect almost all prime European real estate markets to offer an attractive revival and broad-based cyclical recovery opportunity from 2024,” said Hans Vrensen, head of research and strategy Europe at AEW. “For the next five years, we project unlevered prime returns of over 9 percent p.a. on average across our near 200 European market segments in our base case. Our latest relative value analysis shows a clear positive signal for a cyclical re
