A comprehensive summary of the real estate investment market across Southern Europe — Italy, Spain, and Portugal — highlighting trends, sector performance, and total volumes for the full year 2025.
The Southern European real estate market demonstrated strong resilience and momentum in 2025, with combined investment volumes across Italy, Spain, and Portugal exceeding €27.4 Billion, marking a +19% year-on-year increase.
The market continues to be driven by Hospitality and Retail, supported by solid fundamentals, robust tourism demand, and evolving consumer behaviour. The Industrial & Logistics sector showed a clear trend of recovery and consolidation, underpinned by strong demand for high-quality assets and a persistent shortage of available product, which has intensified competition and reinforced the sector’s strategic and resilient position in the region. Offices are showing signs of recovery and renewed investor confidence, while Living, particularly purpose-built student accommodation (PBSA), and alternative assets are increasingly attracting attention. Interest is also growing in Data Centres and urban regeneration initiatives.
The limited availability of high-quality assets across all markets continues to drive competition, highlighting the strategic attractiveness of Southern Europe for institutional and international capital.
Portugal Investment Market
Investment activity in CRE in Portugal reached a total volume of €1.635 Mn in the second half of 2025 contributing to a year-end volume of €2.850 Mn, 17% above 2024.
Retail represented 30% of the investment volume in 2025, attracting €847 Mn with 70% of this amount concentrated in shopping centers. The office sector started showing signs of recovery more than doubling the investment volume of 2024, reaching €708 Mn. Hospitality maintained its appeal with €567 Mn, reflecting sustained interest in leisure and tourism assets with investments concentrated on upscale and luxury assets. There is a significant interest in living and alternative assets, with special emphasis in Purpose-Built Student Accommodation (PBSA), with this sector recording the second largest transaction of the year. The Industrial & Logistics volume more than doubled when compared to 2024 although there is still a shortage of high-quality product for sale in the sector.