- European commercial real estate values rise as rents grow and yields compress across all sectors in 2025
- Prime offices record strongest rent growth ahead of high street retail
- Cushman & Wakefield’s DNA of Real Estate tracks prime rents and yields in 46 cities across Europe.
Cushman & Wakefield’s latest DNA of Real Estate report shows that Europe’s commercial real estate markets recorded steady progress in 2025, with prime rents increasing and prime yields moving inwards across all major sectors. Together, these trends point to improving occupier activity and growing investor willingness to engage with high‑quality assets.
Nigel Almond, Senior Director, Global Property Research & Intelligence, at Cushman & Wakefield, said: "Strengthening occupier demand and renewed investor confidence are driving both rising rents and inward yield shifts, with almost 80% of our tracked office, high street and logistics markets across Europe reporting rising values over 2025. This continues the positive momentum observed in the second half of 2024, with European office values now 10.9% above their trough two years ago, closely followed by high street shops at 10.7%, and logistics at 9%."
Offices
Continued demand for best in class, well located assets helped to increase European prime office rents by 4.6% over the year, in line with the 4.9% reported in 2024. More than 70% of the office markets tracked showed growth over the year, with particularly broad based growth seen across the UK (+8.6%), and in France (+8.2%) driven by strong performances in Paris and Lyon. Southern European markets of Milan (+9.6%) and Barcelona (+5.0%), as well as Warsaw in Central & Eastern Europe (CEE) which was up 9.1%, also posted robust growth. Across these markets, strong occupier demand combined with limited availability of centrally located, best‑in‑class space remains the key driver of rental uplift.
Prime European office yields also tightened by 9bps over the year to 5.37% with almost half the markets tracked reporting an inward shift. Southern Europe, Benelux, the UK and CEE markets all witnessed double digit inward shifts. Although well above their post-pandemic lows, the office sector has witnessed the biggest inward shift of 16bps from a high of 5.53%, with yields moving in for six consecutive quarters.
Retail
Prime European high street retail rents rose 4.4% over the year, an improvement on the 3.6% registered a year ago. Just under 60% of tracked markets posted annual increases, underscoring the broader based growth on the high street over the year.
Robust demand, improving retailer sentiment and constrained supply continue to underpin rental growth, with several key shopping streets recording double digit increases. These include; Bucharest’s Calea Victoriei (+33%), London’s New Bond Street (+14.6%) and Spuistraat (+17.6%) and Lijnbaan (+13.6%) in The Hauge and Rotterdam.
European high street yields moved in by 11bps to 4.76%, the strongest inward shift over the year of any sector in 2025, and 15bps below its recent high of 4.91% in Q1 2024. In 2025, Southern European Markets and CEE reported the strongest shifts at 29bps to 3.81% and 20bps to 5.91% respectively, with the UK & Ireland tightened by 17bps to 4.83%.
Logistics
European logistics rents increased 3.6% over the year, edging up from 3.4% in 2024. Over 70% of the markets tracked reported growth in 2025, underscoring the broad-based growth in rents. Strong occupier demand, limited supply and the provision of newer, higher specification facilities remain the prime drivers of growth in markets across Europe. Brussels (+17.6%) and Paris (+12.0%) led the way with Lisbon (+8.7%) and two UK regional markets – Leeds (10.5%) and Birmingham (8.7%) – also registering strong growth.
Prime European logistics yields edged in 7bps to 5.20%, with yields now 13bps off their recent high of 5.33% in Q2 2024. During 2025 Southern Europe (-23bps), the Nordics (-17bps) and Benelux markets (-13bps) registered the biggest inward shifts, with Italian and Spanish markets of Barcelona, Madrid, Milan and Rome registering inward shifts between 20-25bps, and Nordic markets of Copenhagen, Helsinki, Oslo and Stockholm all registering between 10-30bps inward shifts highlighting the widespread improved sentiment.
