Fewer transactions on the retail real estate investment market in the third quarter – greater momentum anticipated in the fourth quarter

- Investment volume of around €2.5 billion in the first three quarters of 2026 – down 35 percent year on year
- Currently ample availability of property suggests greater transaction momentum in the final quarter
- Price situation prompting international investors to give greater consideration to market entry 

Germany’s retail real estate investment market recorded a transaction volume of approximately €2.5 billion in the first three quarters of 2026, reflecting a decline of 35 percent compared with the year-earlier period. Longer due diligence processes and purchase price negotiations re-initiated in response to interest rate developments are causing delays, particularly in the case of larger transactions, and postponing deals to the fourth quarter or the coming year. 

At around 43 percent, retail warehouses and retail parks captured the lion’s share in the transaction volume, followed by high street retail properties with 25 percent. Shopping centers took a share of 19 percent, while other retail properties combined accounted for 13 percent of the transaction volume. No portfolios sales were recorded in the third quarter. The portfolio ratio stood at 20 percent in the first three quarters compared to 44 percent in the year-earlier period. At the same time, the market is experiencing brisk activity and a growing number of financing applications. This is the conclusion drawn in an analysis prepared by the global commercial real estate services company CBRE.

“We are seeing a clear discrepancy between transactions that are actually concluded and general activity on the market. Many properties and portfolios are currently available on the market but selling processes are taking considerably longer than in the past. The financing environment that remains challenging, investments needed in the structural and technical building condition, compounded by the potential for implementing ESG measures, are placing greater demands on the profitability of investments. Investors are meticulous in scrutinizing the property and the underlying sales concept for compatibility with the respective investment strategy and return requirements.”
Jan Schönherr, Head of Retail Investment at CBRE

The changed price situation nevertheless opens up new possibilities for entering the market. “We are seeing various international investors investigating entry into the German retail real estate investment market, and new players are also checking it out,” Schönherr says. “This includes investors who have so far not been invested in the retail segment. Not all of them will still invest this year. This group will nevertheless be an important source of impetus for market activity in the coming year, while highlighting the interest of international players in Germany’s retail real estate investment market.”

“The food retail business remained the segment most sought after by investors also in the third quarter,” Schönherr comments. “Grocery-anchored retail parks remain a backbone of Germany’s retail investment market and are investigated both as single-asset properties and as part of portfolios. Retail properties requiring less management, such as DIY centers with sustainable operating concepts and leased long term are eliciting interest. We are also seeing interest in shopping centers that, within a business plan horizon, offer four to seven years’ rental and upside potential. In the case of high street properties, transaction processes are proving challenging as, aside from individual trophy properties, demand is generally driven by private individuals and family offices, and buyers’ and sellers’ ideas about price often diverge significantly.”

“Prime yields remained virtually unchanged in most segments in the third quarter compared with the second.”
Anne Gimpel, Team Leader Valuation Advisory Services at CBRE Germany

Shopping centers in prime locations saw yields rise from 5.9 to 6.0 percent. High street property prime yield in the Top 7 cities came in at an unchanged 4.44 percent. Similarly, no changes were recorded for shopping centers in secondary locations (7.75 percent), food markets (4.6 percent), and retail parks (4.9 percent) compared with the previous quarter. Prime yield for DIY centers climbed from 5.85 to 6.0 percent. “Through to the end of the year – and based on the development of interest rates and institutional investors’ partly heightened expectations of greater distributions – we anticipate more price adjustments and yields possibly hardening further in some cases,” Gimpel comments.

Outlook for the full year
“We expect the market environment to pick up momentum in the fourth quarter and for more transactions to be brought over the line than in the third quarter. The pipeline is well filled and interest comes from many places. Some transactions will nevertheless be postponed until next year. Consequently, the transaction volume achieved in the previous year will most likely not be repeated,” Schönherr explains.