Retail market in Europe a mixed picture for investment; occupiers faring better thanks to luxury and tourism

Investment in European retail fell 40 percent in 2023 vs. 2022, to €26.2 billion ($28.4 billion). Yet investor interest in retail assets is slowly gaining more traction in terms of investment market share (20 percent in fourth quarter 2023 vs. 16 percent in fourth quarter 2022), according to BNP Paribas Real Estate.

“This level has not been seen for five years (20 percent in 2018). As a result, retail was the second-least affected sector after hotels,” said Patrick Delcol, head of European retail at BNP Paribas Real Estate.

Investment in retail warehouses in the largest European countries came to €8.5 billion ($9.2 billion) over 2023. This segment, although down 28 percent vs. 2022, showed the greatest resilience among the retail subsegments. It accounted for 50 percent of overall investment in retail assets and is proving increasingly attractive to investors. The High Street segment has seen the biggest year-on-year decline (-50 percent)