The industry forum PERE Europe 2025, held in London in early June, served not only as a meeting point for investors, but also as a platform where key trends in the current European real estate market clearly emerged. Although the event traditionally focuses on private investments, this year’s discussions largely extended beyond individual deals, touching on long-term resilience, digital transformation, and the changing structure of capital.
Financial expert Avi Itzkovich provides an in-depth analysis of the event and of broader real estate trends across Europe.
“What we’re witnessing in the market is a shift from chaotic growth to measured and strategic development. Investors are no longer chasing quick returns. They’re looking for assets with long-term value that can weather economic and political storms,”
Itzkovich emphasizes.
The Market After the Turbulence. Avi Itzkovich Explains
Over the past few years, European real estate has come under significant pressure — from the pandemic and the energy crisis to rising interest rates and a slowdown in construction projects. However, the sector is now showing signs of gradual recovery. According to INREV data, in the first quarter of 2025, the aggregate fund return rose by 1.04%, and capital appreciation increased by 0.56% — marking the best performance in the past three years.
Experts at the PERE Europe Forum acknowledged that it is structural changes in capital management that are helping stabilize the market. Key factors include a shift toward debt instruments, the increased activity in the secondaries market, and enhanced risk oversight.
“Today’s investor isn’t simply buying an asset — they are evaluating all potential development scenarios, from ESG impact to opportunities for technological upgrades,” says Avi Itzkovich.
One of the dominant themes — both at the forum and within the wider expert community — was ESG. Sustainability and energy efficiency have become core requirements for both developers and investors. Properties that fail to meet decarbonization standards are increasingly losing their appeal to major funds.
“The European market is moving toward a model where every square metre contributes to energy efficiency and environmental safety. This isn’t just a passing trend — it’s a real driver of asset value,”
comments Avi Itzkovich. Among the most promising segments, he highlights data centres, modern logistics hubs, and student housing — all of which have shown stable returns even during periods of economic downturn.
Technology as a Catalyst for Change: Avi Itzkovich’s Outlook
Real estate digitalisation is another rapidly accelerating trend. The adoption of data analytics, smart building management systems, and artificial intelligence is becoming the norm for major development firms and asset management funds.
“Today’s real estate is no longer just concrete and glass. It’s a dynamic system generating data on energy usage, user behaviour, and infrastructure performance. These technologies allow us to forecast asset efficiency years in advance,”
says Avi Itzkovich.
These tech-driven changes in asset management are also reshaping investment portfolio structures. The office sector, once the undisputed favourite, is gradually losing ground to industrial and logistics assets. The rise of e-commerce, the demand for fast and flexible supply chains, and higher standards for technological infrastructure are turning this sector into one of the most promising in Europe.
“Where once the prestige of an office location was the top priority, today it’s the flexible functionality and adaptability of space to new business models that matter most. Investors are actively funnelling capital into logistics parks and data processing centres — this is where they see steady returns and built-in risk protection,”
Itzkovich stresses.
He adds that the demand for logistics facilities with high levels of automation and energy efficiency will only continue to grow:
“Industrial hubs equipped with integrated tech solutions are becoming key pillars of the digital economy. They don’t just support commercial activity — they’re setting new standards for the entire real estate market.”
Europe vs. the U.S.: Why Capital Is Returning. Avi Itzkovich Responds
Another trend confirmed during the discussions at the PERE Europe Forum was the growing attractiveness of Europe amid ongoing instability in the U.S. market. American assets remain volatile due to interest rate fluctuations and overheating in certain segments. In contrast, the European market offers a more balanced model, with controlled growth and strict regulatory standards.
“Today, Europe looks like an island of safety. Yes, returns may be lower, but the risks are far more predictable. For major funds and conservative investors, that’s absolutely critical,”
says Itzkovich.
According to Avi Itzkovich, the modern European real estate market can no longer be viewed in isolation from broader macroeconomic, environmental, and technological factors. The London forum served as a reminder that investing in real estate means working with an entire ecosystem — where every component matters, from access to financing to the integration of AI and ESG practices.
“The future belongs to those who can combine financial flexibility, technology, and sustainability. That’s the new standard across all segments of the market — from residential development to logistics,” concludes Avi Itzkovich.
By Chris Bates
