European real estate is entering a new dawn, with evidence piling up to show that the market has entered into a fresh investment cycle.
In its Insights, Strategy and Analysis (ISA) Outlook 2025 report, LaSalle Investment Management reported that market data is crossing thresholds that point to a new cycle. For example, data tracked by LaSalle’s asset managers show that from January 2024 to October 2024, rents for new commercial leases across LaSalle’s European portfolio have grown by 2.7 percent, representing a return to above-inflation rental growth.
LaSalle estimated that expected go-forward returns for the overall European property market are at their highest level in a decade. And as capital slowly returns to the market and yield spreads exceed long-term averages, the real estate outlook has diverged from the region’s weak pace of economic growth due to a combination of supply barriers and asset quality polarization.
The report also claimed th
