A striking 80% of European living sector investors are poised to increase their allocations over the next five years, with Purpose Built Student Accommodation (PBSA) and the Private Rental Sector (PRS) emerging as their preferred targets, according to Cushman & Wakefield's latest European Living Investor Survey 2025. The comprehensive report, featuring insights from institutional investors managing over €1.4tn in global commercial real estate assets, reveals widespread optimism fuelled by demographic trends, supply shortages, and evolving regulatory landscapes.
While PRS dominated 2024 investment volumes with €33bn of the €45bn invested in European living, PBSA has surged as the most attractive near-term opportunity, with 75% of investors planning to increase exposure within three years. Investors are particularly drawn to PBSA's solid fundamentals, inflation-beating rental growth, and reduced regulatory constraints compared to traditional PRS markets. Meanwhile, co-living emerged as the fastest-growing segment, with investor interest projected to jump from 33% today to 44% by 2028.
"Living investments offer stability and diversification to investors, as well as generating social value which helps them achieve ESG-linked objectives. Our survey underlines that core European markets remain a primary focus for investors at this stage of the cycle with a diverse range of capital active in the market currently, concentrating primarily on liquid European markets. As a result, we expect living markets to move into a new expansion phase during 2025," said Patrick Hogan, Head of EMEA Living Capital Markets at Cushman & Wakefield.
"The fact that investors expect to increase their allocations to the living sector over the medium term, extending across a wider variety of segments is a promising sign for the sector's growth and evolution. Yet nothing is perfect, and pricing mismatches, viability and political change are all causing challenges. Overall, however, the mood music is positive, with encouraging signs that investment in EMEA's living sector is set to ramp up in the years to come," added Tom McCabe, Head of EMEA Living Research & Insight at Cushman & Wakefield.
The UK retained its position as investors' most favoured geographic market, with Spain overtaking Germany for second place, while forward commitment structures significantly gained popularity (29% in 2025 versus 18% in 2024), surpassing stabilised stock and joint ventures (both 21%) as the preferred acquisition approach. This shift suggests investors are increasingly willing to secure deals earlier in the development cycle to access prime opportunities in an increasingly competitive market.
- Patrick Hogan, Head of EMEA Living Capital Markets at Cushman & Wakefield
- Tom McCabe, Head of EMEA Living Research & Insight at Cushman & Wakefield
- Cushman & Wakefield - Global real estate services firm providing market research, advisory and transaction services across the living sector
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