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First time all sectors have indicated opportunities since Q2 2022, marking a significant milestone in the recovery
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Office sector moves to the inflection phase – a period marked by stable prices, higher demand, and better economic indicators
Europe’s commercial real estate investment market now presents attractive buying opportunities across all sectors – including Offices – according to Cushman & Wakefield’s latest TIME Score Index, as indicators point towards a stabilisation in pricing and green shoots of recovery and growth.
Developed by Cushman & Wakefield’s EMEA Forecasting team, the TIME (Timing Investment Market Entry/Exit) Score Index utilises historical real estate market data and economic indicators to assess current cyclical positioning and signal conditions and directionality. Scores ranges from 1 (contraction) to 5 (expansion), with a reading towards the higher end suggesting that current conditions are favourable, signalling an opportune time to invest as most variables align positively.
Offices, which had previously lagged behind other sectors, now has a TIME score of 2.7, having moved beyond the cautionary phase to the inflection period. Logistics & Industrial, Residential, Retail and Hospitality retain their position in the inflection period, with scores ranging from 3 to 3.2. The All Property figure is 3.0. Across all property types, there will be variation at the city and asset level.
Sukhdeep Dhillon, Head of EMEA Forecasting at Cushman & Wakefield, said:
“The inflection period is really exciting as this is when market trends start to change direction. This phase signals a shift from decline or uncertainty to recovery and growth, marked by a stability in prices, higher demand, and better economic indicators. It represents the optimal point to capitalise on the early growth and expansion periods that follow. Significantly, this is the first time we have seen all sectors in this opportunistic position since Q2 2022.”
James Chapman, Head of EMEA Capital Markets at Cushman & Wakefield, said:
“The recovery phase in the commercial real estate market presents a strategic opportunity for investors to capitalise on stabilisation and growth trends. We are seeing this feed through into some bigger-ticket items being brought to market after a long absence. As market sentiment revives, the potential for lucrative investments becomes increasingly apparent but with allocations to real estate also likely to rise, it is important that investors act swiftly if they want to seize on early opportunities.”
Looking ahead, as the phase of repricing in commercial real estate concludes, it is anticipated that a greater pool of investors will re-enter the market with increased confidence. The TIME Score leads total returns by two quarters, implying that improvements in the TIME Score often precede increases in returns and activity.
Sukhdeep Dhillon added: “With stable interest and inflation rates creating a favourable economic environment, investor confidence is expected to rise. As a result, we anticipate increased capital allocation, especially in real estate, driving demand, price growth, and higher transaction volumes as investors capitalise on favourable conditions.”
Cushman & Wakefield’s EMEA Forecasting team produces a range of products and research to support clients with their real estate decision making. By identifying key inflections in the current cycle – the ‘when’ – the TIME score allows key strategic and tactical decisions to be ascertained from the team’s longstanding companion research product Fair Value Index, focused on the ‘where’, as well as other resources.
