The European office property market is recording a noticeable revival in cross-border transactions. As a study by property consultancy Savills based on data from research firm Real Capital Analytics shows, the share of international investments climbed to 39 per cent in the current year. In the previous year, 2025, this figure stood at 36 per cent. The driver of this development is a diversified investor base that is increasingly making pan-European allocations again.
French property investment companies, so-called SCPIs, are being particularly active across national borders. In addition to markets in Central and Eastern Europe, they are increasingly targeting Scandinavia. At the same time, buyers from the Czech Republic and Hungary are investing outside their home region more frequently. Private investors and institutional players are also positioning themselves: the family office of entrepreneur Amancio Ortega, Pontegadea, acquired the approximately 45,000-square-metre Capital 8 property in the 8th arrondissement of Paris. In addition, German pension funds and insurers are selectively re-emerging as bidders for prime properties.
Yield pressure from changing interest rate environment
Despite the increased deployment of capital, prime yields reflect higher financing costs. In the third quarter of 2026, the Europe-wide average yield for prime office properties rose by 13 basis points to 5.1 per cent. In major cities such as Brussels, Warsaw, Manchester, the City of London and the Paris business district, yields gained 25 basis points each in response to the changed interest rate level. They also rose by 10 to 20 basis points across Germany's top six cities. Lyon recorded an increase of 50 basis points to 6.0 per cent, while Lisbon climbed by 40 basis points to 5.0 per cent.
A contrasting picture is evident in the Swedish market. In Stockholm, the yield fell by 15 basis points to 3.75 per cent, supported by strong liquidity among domestic market participants. Evidence of this regional strength is the Swedish pension fund Alecta, which recently acquired a portfolio of office properties in Stockholm for EUR 451 million.
Focus on prime locations and rental growth
Karsten Nemecek, Deputy CEO of Savills in Germany, points to the stabilising effect of continuous rental increases on the attractiveness of the asset class. The growing scarcity of modern space and occupiers' strong focus on top qualities open up targeted options for repositioning within central business locations, while new development projects remain largely unprofitable for the time being. Sustained employment growth in core knowledge-based sectors such as technology, finance and management consultancy forms the foundation for solid space demand across Europe's economic centres.
