European investors plan to decrease allocations to real estate

With uncertainty surrounding investment decisions across every asset class, almost one quarter of all investors plan to decrease their allocations to real estate globally between 2023 and 2024. This is barely offset by the 27 percent of investors globally that are planning to increase allocations during the same period, revealing a muted outlook for the industry.

According to the 2023 Investment Intentions Survey published by ANREV, INREV and PREA, European investors are the most cautious, with 37 percent planning to decrease allocations during the period – significantly more than the 20 percent and 5 percent equivalent for their North American and Asian Pacific peers.

However, the current average allocation to real estate globally is 10.2 percent, only slightly below the average target allocation of 10.4 percent. The equivalent gaps narrowed significantly for European and North American investors, related to the dominator effect as other asset classes fell