Insights /
Market Pulse
/
May 2026
German commercial real estate
A practical look at transaction volumes, yields, and what they mean for investors heading into 2026
Where the market stands
The German commercial real estate market closed 2025 with a total transaction volume of €33.9 billion—four percent lower than in 2024. While the final figure is modest, the internal market dynamics are far more interesting than the aggregate number suggests.
The number of transactions rose by ten percent year-on-year, while the average deal size fell from €32 million to €27 million. "Small is beautiful" was the principle that defined market behavior. This is significant for private investors and family offices: the €5–50 million segment, historically underserved by large institutional capital, remains active and competitive.
Yields — current levels
Four segments shaping the yield landscape in the Top 7 cities.
Offices · Top 7
Prime yield 4.9%
Stable after two years of growth during asset repricing. Core and core-plus transactions in Frankfurt, Munich, and Berlin are once again being executed at these levels. The repricing cycle appears to be complete.
Retail · prime high street
Prime yield 4.46%
Retail recovered in 2025, with investment volumes reaching €6.5 billion, a 57% increase over 2024. Demand for properties with grocery anchors and large-format retail in city centers remained resilient.
The liquidation of the Signa portfolio generated significant off-market deal flow at discounted prices.
Logistics · Industrial
Prime yield 4.50%
A structurally resilient segment. Demand from e-commerce and data centers is supporting fundamentals and keeping yield spreads tight relative to prime office assets.
Hospitality · €1.97 billion
Return of core capital
The €1.97 billion invested in 2025 marks significant growth compared to previous years. Occupancy and RevPAR have recovered to levels exceeding pre-pandemic figures in most key markets. Core capital is returning.
Practical insights
The market has moved past the phase of forced repricing, but the yield compression cycle has yet to begin. The opportunity lies not in yield compression, but in operational improvements and selective asset picking.
Three observations relevant to current mandate-based activities:
Off-market deal flow
Refinancing pressure on assets acquired with high leverage between 2019 and 2021 continues to push properties onto the market quietly. Sellers prefer discretion. This is where the mandate-based model creates value by providing access to assets before they reach the public market.
€5–50 million segment
Large institutional capital is returning to mega-deals. The mid-market—our primary focus—remains less competitive and offers a better balance between value and execution complexity.
Regional diversification
Beyond the Top 7, secondary cities (Hanover, Dresden, Leipzig, Mainz) are once again attracting investor interest. A yield premium of 50–100 basis points is available for comparable asset quality in well-located regional hubs.
Specific investment decisions require individual analysis and comprehensive due diligence.
// KEY FIGURES
TOTAL TRANSACTION VOLUME · DE 2025
TRANSACTION VOLUME
AVERAGE DEAL SIZE
PRIME YIELD · OFFICES [TOP 7]
PRIME YIELD · RETAIL
PRIME YIELD · LOGISTICS
INVESTMENT VOLUME · HOSPITALITY REAL ESTATE
SHARE OF INTERNATIONAL BUYERS
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