European commercial real estate investment fell in 2023 to the lowest level since 2012. High interest rates and lackluster economic growth preserved a wide disparity in pricing expectations of buyers and sellers, depressing transaction activity, according to the latest Europe Capital Trends report from MSCI Real Assets.
The volume of completed transactions in 2023 halved from a year earlier to €166.1 billion ($179.8 billion), sparing no market or sector, the report showed. Property sales declined 43 percent in October through December from fourth quarter 2022, to €41.1 billion ($44.5 billion). That left Europe’s overall investment activity in commercial real estate more than 60 percent lower than at the peak registered in June 2022.
Last year was not a great vintage for European real estate. Our pending transactions data point to a continuation of the subdued activity with property values still falling for the most part,” said Tom Leahy, head of EMEA real as
