The rise in interest rates and inflation, the “More Housing” package, the two ongoing wars and now national political instability, have contributed to investment in commercial real estate registering a slowdown of 60% this year compared to 2022, according to preliminary data provided to ECO by the consultants.

If this evolution is confirmed, Portugal is no exception to the trend of slowdown in investment that has been felt across Europe and which is expected to continue in 2024.

The consultants consulted by ECO predict that, at the end of this year, the number of closed transactions in commercial real estate — hotels, logistics, retail or offices — will not exceed 80 (72 of which were concluded by October) with a total business volume of around 1.4 billion euros. Numbers that reflect a 70% drop in the number of transactions and a 60% drop in investment volume, compared to last year.

For 2024, expectations are not much better. The scenario of falling investment is expected to continue, predict market experts interviewed by ECO.

“It is expected that 2024 will still be a year with a volume of real estate investment well below that seen in the recent past, and it is likely to see a reduced volume in the first half of the year with a progressive recovery throughout the second half of the year”, points out Nuno Nunes, senior director of capital markets at CBRE Portugal, who says it is still unlikely that next year, the total investment volume will exceed 1,500 million to 2,000 million euros.

Also Alexandra Portugal Gomes, head of research at Savills Portugal, points out that in 2024 there are projections that are “slightly more optimistic, but still very much in line” with 2023, especially in the first half of the year, which will be “marked, essentially, by caution and very careful analysis of risks.”