Which European cities are considered the most attractive for real estate investment in 2026? The ranking is as follows:
1. London 2. Madrid 3. Warsaw 4. Barcelona 5. Milan 6. Paris 7. Amsterdam 8. Lisbon 9. Copenhagen 10. Berlin / Stockholm
According to the latest report by CBRE, one of the world’s most authoritative commercial real estate advisory firms, London has been ranked the most attractive destination for cross-border real estate investors for the second consecutive year, as highlighted in the European Investor Intentions Survey 2026.
At the country level, Spain is the top investment destination, selected by nearly 50% of respondents, driven by strong macroeconomic fundamentals, tourism flows, and robust demand for residential property. The United Kingdom remains highly attractive, followed by Poland, Italy, Germany, Portugal—which has maintained a strong position for the second consecutive year—along with the Netherlands, Denmark, France, and Sweden.
Although Georgia is not analysed separately in the CBRE survey, global and European investment trends provide important signals for Georgian investors as well, particularly those considering real estate from a medium- to long-term investment perspective.
In 2026, investors are expected to remain active. According to the survey, 89% of investors plan to maintain or increase their purchasing activity, while 83% are considering asset sales, indicating improved market liquidity and portfolio rebalancing.
Since 2022, the Living (residential) sector has remained the most in-demand investment segment. A significant share of investors plan to increase capital allocation to residential assets, reflecting structurally strong and stable demand.
Investment activity in the hotel sector is also expected to grow in 2026, particularly in tourism-driven locations.
While some investors intend to reduce exposure to office assets, a larger share continues to believe in the sector’s recovery potential. Overall sentiment toward offices remains positive, although investors are increasingly selective and cautious, prioritising quality and location.
Despite logistics remaining a popular sector, part of the investor base plans to slow or reduce investments, suggesting partial market saturation. Sentiment toward retail assets has improved compared to the previous year, with investors continuing to favour well-located, prime retail properties.
In terms of investment strategies, value-add is the most attractive approach for European real estate investment in 2026. This strategy involves acquiring lower-quality, obsolete, or refurbishment-required assets and enhancing value through renovation, repositioning, or change of use. 37% of surveyed investors prefer value-add strategies.
Core plus ranks second at 26%, representing a moderate-risk strategy focused on income-producing assets with potential for incremental value enhancement through targeted upgrades.
Interest in core strategies has increased slightly in 2026. Core assets are characterised by low risk, completed, high-quality properties that are fully leased and generate stable income.
In addition, 69% of investors plan to invest in at least one alternative sector. These include student housing, senior living, and healthcare-related real estate.
Despite generally positive expectations, investors continue to face several challenges in 2026. Key risks identified include:
- Mismatch in pricing expectations
- Uncertain geopolitical landscape
- Persistently higher long-term rates
- Economic hard landing / recession
- Regulatory risk
- Changes in fiscal policies / taxatation
Conversely, investors believe the real estate market will be supported by the lower debt costs, Attractive price entry points, reduced supply pipelines, and greater price alignment between buyers and sellers.
According to the survey, ESG considerations in 2026 are no longer viewed merely as a regulatory requirement, but increasingly as a direct value-creation tool in real estate. 88% of investors state that ESG factors influence their investment decisions. More than half prioritise retrofitting existing buildings, linking improved energy efficiency to higher asset values and stronger market positioning.
At the same time, approximately one-quarter of investors demand price discounts for assets with weak ESG credentials, while others avoid such assets altogether. This confirms that sustainability now directly affects both pricing and liquidity.
In summary, European real estate remains attractive to investors, with transaction volumes expected to stabilise or grow. Value-add and core plus strategies are particularly favoured due to relatively attractive entry pricing. The Living sector remains the primary investment choice, while interest is also increasing in social housing and healthcare-related assets.
For Georgia, these trends suggest that investors should look beyond newly delivered projects and also consider older residential or commercial assets in strong locations, where refurbishment and repositioning can significantly enhance value.
Across Europe, ESG performance is already influencing asset pricing, a clear signal for the Georgian market as well: energy-efficient buildings are likely to be easier to lease and sell in the future.
If you are considering investing in real estate in Georgia, Kedaro Group is ready to provide you with professional guidance.
Contact us:
- Email: kedarogroup@gmail.com
- Phone: +995 593 618 181
- Address: 18/22 G. Atoneli Street, 0105 Tbilisi, Georgia
