Investment market recovers beyond expectations
Looking back at 2025
The Dutch investment market recovered in 2025, rising 15% compared to 2024.Total investment volume reached €13 billion, exceeding CBRE’s earlier forecast of €12.5 billion. This recovery underscores the return of investor confidence, while at the same time showing that momentum remains selective.
Private investors dominate
Private equity parties fell short of expectations in 2025. As a result, private investors, family offices, and Dutch and French private funds accounted for 52% of total acquisitions, compared to just 15% in 2021. Private equity is primarily exploring the office market, but the 10.4% transfer tax and their shorter investment horizon reduce its attractiveness. Consequently, large‑scale investments and the associated wave of renovations remain limited, slowing down the much‑needed renewal of the built environment.
Core investment market remains manageable
The core investment market remains relatively clear and contained. Dutch investors are primarily focusing on new, affordable residential complexes and, occasionally, on offices, opting for investments with predictable cash flows and a limited risk profile. At the same time, the constrained availability of capital is slowing growth, while the occupier market is demanding more than the current supply can offer.
The Netherlands in the European mid-range
Compared with the five largest European countries, the Netherlands is positioned in the middle of the recovery curve. Considering its historical reliance on foreign capital, this recovery appears relatively strong. Germany continues to show a notably flat trend, driven by weaker-than-expected economic figures, capital outflows from open‑ended funds, the traditionally slower write‑down of book values, and the very challenging business case for new residential development. Spain, by contrast, is showing a robust recovery, supported by strong economic growth and an attractive residential investment climate. This is resulting in a significant boost in new residential construction activity, particularly fuelled by foreign investors.
Foreign capital remains on the sidelines
Strong fundamentals, fragile confidence
The continued caution among foreign investors marks a break from the past. Across all sectors, their activity remains limited, even though the Netherlands is performing strongly from both an economic and demographic perspective compared with other European countries. At the same time, the occupier market offers attractive conditions. In prime locations, most submarkets are experiencing relative scarcity, which is driving rental growth and, in turn, supporting capital values over the longer term.
Distorted investment climate weighs on confidence
The limited inflow of foreign capital is closely linked to the weakened investment climate of recent years. The attractiveness and overall confidence in the Dutch investment market have been significantly undermined. Key drivers include the higher transfer tax, the abolition of the FII regime, and multiple initiatives aimed at rent regulation in the residential market. The planned reduction of the transfer tax to 8% for residential assets as of 2026 provides little structural relief, as the Netherlands’ international competitiveness will remain under pressure.
Cyclical behaviour determines the timing of capital
These policy changes, however, do not explain the full picture. After a cyclical downturn, foreign investors typically refocus on their domestic markets first. Only once a broad‑based recovery takes hold does capital start to flow across borders again. From that perspective, the share of foreign capital is expected to increase slightly from 2026 onwards. However, part of the potential will remain untapped, mainly due to the heavy impact of the transfer tax on investments with a shorter holding period.
Strong sectoral differences in recovery path
The cyclical pattern described earlier shows clear differences between sectors. Across the board, more capital is circulating in the investment market than in previous years, as evidenced by the higher number of bids per sales process. At the same time, the number of buyers in the core segment remains limited. This restraint is directly linked to the low capital allocation within core real estate funds.
Focus on core+ and value‑add
Most transactions took place in the core+ and value‑add segments. It is precisely in investments with slightly more risk – and therefore more room for returns – that opportunities emerge, driving movement in the market. As a result, sector‑level recovery relies heavily on this category.
Residential complexes as key driver
The greatest momentum came from the sale of existing residential complexes. In total, €2.5 billion worth of complexes changed ownership. Investors once again broadly opted for individual unit sales: 73% of the volume focused on selling rental units separately on the owner‑occupier market. This involved approximately 7,000 homes, excluding sales by smaller private landlords.
Recovery in new‑build rental housing
The new‑build rental market strengthened significantly, particularly in the final quarter. Over the year, investors committed €2.7 billion in forward‑funding arrangements for new residential projects. These investments will deliver around 8,700 rental homes over the next two to three years. Institutional investors added a net total of roughly 1,700 homes to the stock. The limited growth is largely due to the absence of foreign investors, who are instead deploying their capital in countries such as Spain, where conditions are more favourable.
Reduced momentum in the logistics market
The logistics market continues to lag behind with a volume of €2.9 billion. The weakening occupier market and geopolitical uncertainties are increasing risk and suppressing activity for existing assets. In addition, constraints such as nitrogen regulations, grid congestion and rising vacancy rates have led to a sharp decline in the development of new logistics centres.
Fragile recovery in offices
The office market showed a modest recovery, with €2.1 billion in volume. Solid occupier fundamentals and assets near public transport hubs offer clear rental growth potential. Yet institutional investors remain cautious, leaving the market largely driven by private family capital and French retail funds (SCPIs). Private equity is more active across Europe but faces too much friction in the Netherlands due to the high transfer tax and persistent book values.
Broader recovery in retail
The retail market demonstrated a more broadly based recovery. More capital entered the sector again, including from international investors. Total investment volume reached €1.5 billion. Notably, shopping centres accounted for a large share: 36% of total volume flowed into this segment, the highest proportion since 2015.
Hotels and healthcare real estate
The hotel sector shows the strongest recovery, supported by a robust overnight‑stay market, though largely driven by the RCN Vakantieparken transaction. In healthcare real estate, new development continues to lag far behind demand, with only €281 million invested in new care homes. Most activity therefore occurred in existing assets, totalling €366 million in transactions between care providers and investors, or between investors themselves.
Liquidity continues to increase
The growth in investment volume is partly driven by increasing liquidity in assets with higher ticket sizes. In a downward cycle, this segment is typically the first where activity stalls. The fact that momentum is returning here signals a clear upward turn in the real estate cycle.
Higher share above €50 million and €100 million
In 2025, 53% of total investment volume came from transactions above €50 million, compared with 42% in 2024. The market also accelerated in the €100 million‑plus segment, where the share rose from 21% to 34%. This shift highlights the clear increase in liquidity and indicates that the market is moving back toward full liquidity.
Recovery varies by sector and risk class
At the same time, nuance is required. In the residential investment market, liquidity is visible across all risk classes. For offices, industrial/logistics and retail, this picture is less broad when compared with the peak of the cycle. Nonetheless, every sector shows a clear improvement compared with 2024.
Offices: focus on core+ and value‑add
In the office market, core capital remains scarce. German open‑ended funds are holding substantial liquidity due to continued outflows and potential future redemptions. As a result, core+ and especially value‑add strategies dominate the landscape, driven primarily by private investors.
Logistics recovers in the second half
The logistics market showed more hesitation in the first half of the year due to uncertainty in the occupier market. That picture is now stabilising. Investors are gaining better insight into vacancy risks and rental prospects, which has resulted in more activity across all risk classes in the second half of the year.
Retail shows the strongest recovery
The retail market demonstrates the strongest improvement. The sale of several large shopping centres by Dutch private investors and international buyers has given the market a clear boost. Demand for retail assets is visibly strengthening, further increasing transaction momentum.
Outlook for 2026
For 2026, the rising momentum is expected to continue, including in the upper end of the market. Only the availability of core capital for offices is likely to remain limited, which means this segment will continue to be driven primarily by more opportunistic strategies.
Limited decline in initial yields
Although market momentum is increasing across the board, this is barely reflected in lower prime net initial yields. The expected decline in government bond yields and the 5-year IRS swap rate did not materialise; in fact, both rates have recently risen. This interest rate development feeds directly into real estate pricing.
Interest rates offset competitive pressure
Higher liquidity and increased buyer competition are largely neutralised by higher interest rates. As a result, prime net initial yields across almost all sectors remain comparable to the levels seen at the end of 2024. With stable rental income, property values therefore remained virtually unchanged over the past year
Offices and retail remain sharply priced
Offices and retail assets continue to be sharply priced relative to their position in the cycle. At the same time, the office market is approaching a turning point: prime yields have now edged down compared with last year. This shift is driven by improving sentiment among private investors and family offices.
Reduced stigma around office real estate
The negative narrative surrounding office investments is losing traction. More nuanced data on hybrid working is softening the stigma that emerged in recent years. As a result, the risk premium on offices is declining and moving back toward its long-term average.
Residential assets remain a clear exception
The residential investment market deviates noticeably from the broader trend. The large pool of Dutch institutional capital is putting significant downward pressure on initial yields. For fully regulated mid-rent projects, yields have now returned to early-2022 levels – the low point of the previous cycle.
ESG as a catalyst for feasibility
The extent to which projects meet ESG criteria carries substantial weight. Additional investment in sustainability quality and social value not only improves the asset profile but also strengthens overall financial feasibility
Value creation shifts toward asset management
Outside the residential sector, potential capital value growth is driven primarily by improved leasing performance. As a result, active asset management is taking on an increasingly central role within real estate portfolios. This is where the clearest opportunities for value creation now emerge.
More momentum expected
Outlook for 2026
Expectations for the investment market are cautiously positive. Available capital in 2026 is expected to remain broadly in line with 2025 levels, allowing the improvement in liquidity that began at the end of 2024 to continue. Market depth is increasing, despite the absence of broad-based compression in initial yields. Some nuance is needed, however: limited partners remain more cautious. This is partly a composition effect. Private equity players have more capital available for value-add strategies, while the availability of core capital is much more limited.
More momentum driven by increased willingness to sell
The market expects more momentum in 2026. Around 22% of investors indicate that they plan to increase their sales activity by more than 10%. This shift expands the supply of assets and strengthens liquidity. In addition, a larger share of assets is reaching the end of their holding periods. As value growth tapers off after stabilisation, funds are more inclined to sell.
Reallocation accelerates disposals
Funds are also continuing sectoral reallocations. This repositioning naturally leads to more disposals, creating additional supply even without an immediate need to sell. In the office market, the impact of redemptions – particularly among German open-ended funds – is still visible and may continue to generate additional sales this year.
Allocation shifts follow familiar patterns
Expectations regarding allocation shifts show mainly nuanced differences compared to last year. In Europe, a substantial amount of capital is once again flowing into the residential market. Previously, this movement was strongly focused on the United Kingdom and Spain. In the Netherlands, Dutch pension funds in particular took the lead. At the same time, the playing field is broadening as fund managers increasingly target student housing and senior living.
Logistics remains strong, but less clear-cut
The logistics sector maintains a positive profile, similar to last year. However, a slightly larger share of investors is opting for a modest reduction in allocation. Last year, the emphasis was still on expansion. This shift is related to more moderate rental growth expectations and rising vacancy levels in several countries, including the Netherlands.
Retail real estate gains traction among fund managers
In the retail market, it is mainly fund managers who are increasing their allocation. Limited partners remain cautious, despite the resilience the sector has shown in recent years. That resilience is reflected in stable performance. As a result, sentiment among limited partners is also improving, and the diversity of buyer groups continues to grow overall.
Office market remains divided
The office market, much like last year, shows a mixed picture. Private equity and family offices are allocating more capital toward offices, ensuring sufficient interest in value-add and core+ propositions. However, the core segment remains scarce. This limits new office developments, partly due to limited pre-letting activity in the occupier market. As a result, core capital is concentrated primarily among Dutch institutional investors and a small, highly selective group of foreign parties.
Significant outflow from German open-ended funds
The limited availability of core capital in the Dutch investment market is closely linked to the continued outflow from German open-ended real estate funds. For 27 consecutive months, retail capital has been flowing out. As a result, funds that had been active investors in Dutch real estate for decades remain absent. Only institutional separate accounts are showing activity, although they typically require core+ or value-add returns.
Slow recovery among German funds
This keeps the market for core capital shallow. Although the outflow is gradually easing, the market does not expect a structural inflow for another two to four years. The delayed recovery is partly due to the slow recognition of losses, which keeps negative sentiment in place. In addition, 62% of these funds’ portfolios consist of offices, an asset class for which retail investors currently show limited appetite.
Shifts in allocations
To counter this sentiment, many funds are gradually shifting their allocations toward residential and logistics real estate. This reduces their allocation to offices and aligns them with more stable demand. However, this repositioning takes time, further delaying the recovery of core capital.
Liquidity as a strategic buffer
In the meantime, these funds hold an average liquidity position of 15%, well above the statutory minimum of 5%. Liquidity levels vary between 5% and 25%. This reflects three dynamics: funds with low liquidity ratios tend to sell assets sooner – especially offices; others are actively steering toward reducing their office allocation; and a third group maintains deliberately high liquidity as a risk-averse strategy. If outflows continue to decline over the coming years, this could result in these funds once again having significant liquidity available to invest in core real estate.
Outlook for the Netherlands
For the Netherlands, this means an increase in investment opportunities in the short term. At the same time, the likelihood of renewed inflows of core capital rises in the medium term. Once outflows diminish, the more liquid funds in particular will regain the capacity to invest broadly in the real estate market.
Focus on optimisation & rental growth
Interest rates are expected to move largely sideways in the coming period, keeping yield compression limited. Liquidity, rather than interest rates, remains the primary driver. As a result, prime net initial yields are expected to show a near-flat trend in the short term.
Value creation through operations and rent
Capital value growth will come predominantly from operational optimisation. This includes rental growth driven by market tightness and stronger negotiating positions. Across all sectors, occupier markets remain tight, particularly for high-quality assets. This creates opportunities to actively add value.
Market tightness accelerates rental growth
This tightness results in two clear effects. First, rental growth is accelerating: CBRE expects average annual growth of 2% to 5%. Second, the maximum achievable rent is increasing. This opens opportunities for investments, refurbishments, and new developments. As a result, value-add investors are increasingly drawn to the market with focused optimisation strategies.
Renewed confidence in the retail sector
In the retail sector, a clear shift is emerging. Shopping centres in particular are benefiting from rising purchasing power and an increasing number of households. At the same time, e-commerce spending is stabilising. Together, these trends strengthen confidence in further rental growth potential.
Quality pays off in the office market
Rental growth in the office market has been ongoing for several years and is increasingly concentrated in renovated and newly built assets. Higher rent levels create room for value-add strategies, allowing investors to generate substantial additional value through quality improvements.
Stabilisation with potential in the logistics sector
The logistics sector has entered a more stable phase following the e-commerce surge. Vacancy rates are expected to level off toward 2026, and rents on strong locations are broadly tracking inflation. At the same time, rental optimisation within existing assets remains attractive.
Structural pressure in the residential market
Rental growth in the residential market remains strong. The practice of selling individual units out of rental stock (“uitponden”) plays a major role, worsening the supply-demand imbalance – particularly in major cities. In these locations, a substantial share of private rental housing has disappeared from the market, intensifying scarcity.
Investment volume increases by over 10%
These developments result in an expected investment volume of €14.3 billion in 2026, marking a continuation of the market’s gradual recovery. At the same time, capital allocation remains selective, with investors focusing on sectors that offer stable demand and clear value-add potential.
Residential investment market remains dominant
As in previous years, the largest share of capital is expected to flow into residential real estate. CBRE forecasts an investment volume of €5.35 billion (+3.4%). Dutch investors continue to dominate new-build acquisitions and are increasingly shifting their focus toward student housing. In addition, the practice of selling individual units (“uitponden”) is gaining traction, with institutional investors more frequently arranging these disposals themselves rather than selling entire complexes to specialised parties.
Postponed transactions materialise in the logistics sector
The logistics market shows a dynamic similar to the second half of 2025. Geopolitical uncertainty pushed several portfolio transactions into 2026, while an increasing number of distribution centres are reaching the end of their holding periods. Taken together, this results in an expected investment volume of €2.95 billion (+3.6%).
Growing confidence in offices
The office market continues its steady expansion. Occupancy levels, rental growth, and the ongoing flight to quality are creating clear value-add opportunities. However, high transfer tax continues to restrain the flow of capital. It remains an unfortunate dynamic, as these investments help modernise and sustain the office stock. Most capital comes from private investors, complemented by private equity and a select group of core investors. Altogether, the office investment volume is expected to total €2.8 billion (+33%).
Retail benefits from scarcity
Interest in retail real estate continues to rise and is spreading across multiple subsectors. Low vacancy, minimal new development and a growing population support stable rental growth. This growth remains competitive with other real estate categories. The expected investment volume is largely driven by limited supply and is set to increase to €1.6 billion (+10%).
Hotels under pressure, but in motion
The hotel market continues to perform strongly, but the VAT increase is prompting further operational optimisation. In Amsterdam in particular, several hotels are coming to market at more realistic pricing levels. As a result, the investment volume is expected to remain stable at approximately €700 million, similar to last year.
Healthcare real estate: strong demand, limited supply
Demand for healthcare real estate remains high among both operators and investors. However, available product is scarce. The increase in the Normative Housing Component (NHC) reduces the supply of existing assisted-living facilities. Developers remain cautious about new construction due to strong broader housing demand. Nevertheless, CBRE expects an investment volume of €800 million (+24%), supported in part by the approval of the transaction between Aedifica and Cofinimmo.