The transaction volume in the German investment market for commercial and residential properties reached approximately EUR 14.7 billion in the first half of 2026, remaining largely consistent with the previous year (EUR 14.4 billion). Similar to the previous year, the second quarter of the current year saw lower turnover than the opening quarter. While US tariff policy influenced the market in 2025, activity this year was significantly dampened by the ongoing conflict in the Middle East.
Karsten Nemecek, Deputy CEO Germany and Head of Capital Markets at Savills, describes the market situation. He observes that many market participants are seeking orientation in an uncertain environment and finding only limited clarity. This leads to extended decision-making and transaction processes amidst limited market liquidity. Numerous processes, especially in the large-volume segment, continue to be cancelled. Nevertheless, it is becoming clear which properties meet current demand criteria. Property owners are now better able to assess the market attractiveness of their assets and are consequently selecting their sales strategies more precisely, which could lead to more completions in the long term.
The number of transactions in the residential segment saw the strongest increase, although the transaction volume was five percent below the previous year's figure. This is attributable to a reduction in the average transaction size. Nevertheless, the residential segment remained the highest-performing with approximately EUR 3.8 billion in the first half of the year. This was followed by industrial and logistics properties and offices, each with EUR 2.3 billion, their turnover being about one tenth higher than the previous year. Conversely, the volume for retail properties fell by more than a third to just under EUR 1.8 billion.
- —Healthcare and social properties recorded the largest increase in turnover among all usage types, with a rise of 50 percent.
- —As the only segment, the transaction volume for healthcare and social properties exceeded the ten-year average by 42 percent.
- —The acquisition of Cofinimmo by Aedifica contributed approximately half to the half-year turnover in this segment.
Matthias Pink, Head of Research Germany at Savills, explains the rarity of transactions in the triple-digit million range. Five of the ten largest single-asset transactions in the first half of the year involved the public sector as buyer. Two other sales resulted from insolvencies. Thus, only three transactions served as genuine market benchmarks, whereas numerous sales processes were cancelled. Especially for large-volume office properties, the number of potential buyers remains limited, regardless of the risk class.
The acquisition volume by the public sector, exceeding EUR 2 billion in the first half, reflects its active role and already corresponds to the total investment volume of 2025. Institutional investors, however, acted cautiously. Direct investors such as pension funds (EUR 150 million acquisition volume) and insurance companies (EUR 75 million) were barely active in the first half. Open-ended real estate public funds, traditionally buyers of large assets, primarily acted as sellers. Family offices and private investors played a disproportionately large role in a long-term comparison with an acquisition volume of just under EUR 1 billion; however, their individual acquisitions over EUR 50 million were less frequent than in the previous year.
Savills assesses demand as stable but without recognising an increase. This contrasts with a large and generally growing supply. Combined with the rise in interest rates since the start of the Middle East conflict, this results in increased price pressure. Initial yields for properties outside the prime segment rose in the second quarter; prime yields also selectively increased. Savills expects a further rise in the coming months.
Nemecek outlines the overarching outlook for the rest of the year. He points out that in the previous year, a weak second quarter was followed by a significantly stronger second half. Whether this pattern will repeat in 2026 remains to be seen. The ongoing uncertainty suggests a continued wait-and-see attitude from many investors. At the same time, supply and pragmatism on the seller side are increasing. However, a fundamental shift in market dynamics is not currently discernible. In its base scenario, Savills still anticipates a transaction volume of approximately EUR 35 billion for 2026.
