European office markets are entering a new phase where rental growth in supply-constrained central business district (CBD) locations is expected to improve liquidity and support value recovery. Catella House View Office Outlook identifies a growing divide between prime offices in central locations and aging secondary stock, creating selective opportunities for investors able to capitalize on constrained supply, rental growth and improving market liquidity.
Despite ongoing uncertainty surrounding hybrid working and the long-term impact of artificial intelligence (AI), Catella argues that offices remain a relevant asset class. Future returns are expected to be concentrated in modern, sustainable buildings in central business districts, where limited development pipelines and rising replacement costs continue to support rental growth.
The report hig
