Investment Market Overview

Updated in July 2022

High global liquidity, together with a wealthy economic growth and the strong fundamentals observed in the Portuguese real estate markets, have shifted property investment to a new level after the financial and economic crisis, more than duplicating the previous peak volumes.


Source: CBRE Research


The strong investment activity observed since 2015 has particularly targeted the office and shopping centre sectors, although the interest has diversified to other asset classes.

Effectively, greater risk acceptance has attracted the interest from various investors to other operational assets, such as hotels, student housing and healthcare. Investment in student housing has been mainly driven by forward purchase deals as the PBSA market is emerging in Portugal. The transaction of large residential portfolios has also boosted the capital inflow to this asset class, where the multifamily/ build-to-rent market is still embryonic.

A slowdown in investment activity was observed during 2020 and 2021 Covid-19 pandemic years, particularly in retail.

Capital inflow to commercial property totalled €720 million in the first half of 2022, a 36% increase year-on-year. The logistics market has finally kicked off and, along with hospitality, were the asset classes that attracted the largest investment during this period. Offices maintain the attractiveness and confidence of investors. We continue to anticipate a strong investment volume over 2022, to similar pre-pandemic levels, as several portfolios and major single assets are under negotiation.

Yields have been compressing since 2013 in all sectors, achieving historic record lows. The Covid-19 pandemic drove an upsurge in hotels and retail prime yields, while logistics recorded a downward trend. The hike in interest rates is expected to drive a general rise in yields until the year end. However, in a few office and logistics submarkets where fundamentals remain very strong, with low vacancy rates and rental growths, yield stabilisation is still foreseen.

Prime yields in the main property asset classes



Source: CBRE Research, July 2022