After three challenging years in the real estate market, the recovery is continuing. Returns on property investments are rising again relative to government bonds, making real estate attractive components of investment strategies once more. Over the medium term, demand for tangible assets, especially real estate, is expected to increase significantly.

Valuation adjustments, higher construction and financing costs, and—particularly for office properties—changing space requirements have had the greatest impact on the real estate market. Brockhoff’s investment team has been observing for some time that more stabilising factors are shaping market activity again. “Capital market interest rates and valuation criteria for core properties have stabilised at a new level, and we expect this positive trend to continue into 2025,” says Brockhoff Managing Director Jörg Langensiepen.

Although record results like those of the last market boom are not expected in 2025, the market will continue to gain considerable momentum:

• Modern office properties in good and very good locations are once again being considered as investment assets. Demand is focused on sustainably refurbished properties that allow flexible space concepts.
• In some locations, residential properties are already seeing price increases again. Given the decline in new construction, rents are set to continue rising. This gives investors a high degree of predictability, especially when planning over the long term.
• Neighbourhood retail centres with creditworthy tenants and logistics properties will continue to offer attractive investment opportunities in 2025. Here, too, reduced construction activity is expected to increase demand for space and push rents higher.
• In light of demographic change, healthcare properties and medical centres, as well as infrastructure-related properties (fire stations, police stations, daycare centres, etc.), are increasingly becoming high-yield investment assets for the long term.

“2025 offers high-yield opportunities across all real estate asset classes. Investors with substantial capital in particular can seize the moment and benefit from the market environment,” the real estate expert concludes.