Commercial property intelligence service Altus Group has given its latest quarterly market snapshot of European valuation trends.
Using aggregates of CRE valuation data for the European market, adding in Pan-European open-ended diversified funds.
For the fifth consecutive quarter, commercial property values across the Pan-European valuation dataset increased in Q3 2025, rising 0.6% to match the gains in Q2 2025 and reaching 2.9% year-over-year from Q3 2024.
The pace of growth is primarily attributed to improving cash flow fundamentals which have added 2.6% to values in the past 12 months. The remaining 0.4% comes from the positive yield impact, reflecting a steady improvement in investor sentiment, aided by the shift to lower interest rates.
“For a fifth consecutive quarter, we appear to be witnessing a measured yet sustained improvement in values across all sectors in Europe,” says Phil Tily, Senior Vice President at Altus Group. “While no single sector is leading the rebound, the broad-based nature of the gains gives us confidence that the CRE recovery is taking hold.”
Key highlights by sector include:
- Residential: The residential sector remained the top performer of the four main sectors in Q3 2025 with a 0.7% value increase over Q2 2025. Values benefitted from strengthening cash flows and a reduction in valuation yields.
- Industrial: The industrial sector slipped down the ranking through the course of the year, with values rising by a below average 0.5% in Q3 2025 over Q2 2025. Cashflow appreciation slowed in Q3 2025, marking the lowest level across the main sectors in Q3 2025.
- Office: Having faced the steepest value write-downs during the market downturn, the office sector remained at the lower end of sector performance in Q3 2025. Office sector valued increased 0.5% over Q2 2025.
• • Retail: The retail sector valued increased by 0.6% in Q3 2025 over Q2 2025. Although yields expanded putting downward pressure on values, this was offset by a strengthening in cashflows, with retail market rents having increased by an above-average 0.5%.
