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Trends in the European Real Estate Sector for 2024 

Delving into the dynamic and intricate tapestry of the economy, the real estate sector, stands as a vital cornerstone, encompassing in a spectrum of activities ranging from buying and selling to the development and management of real estate. This dynamic industry is influenced by a wide range of factors: a recent study made by PwC and the Urban Land Institute highlights positive prospects, focusing on real estate segments that offer stable income and resistance to potential negative market impacts. In the following article, we will deep dive into three main trends of the upcoming year.  

Sustainable Development in the Real Estate Sector 

ESG criteria (Environmental, Social, and Governance) have had a great influence in the real estate market since the approval of the 2030 Agenda in 2015. Particularly, private sector companies are progressively embracing to these criteria, placing a special emphasis on the environmental consideration. Reports from companies like Colliers indicate that adhering to ESG criteria is no longer optional but has become essential and indispensable. Notably, a recent CBRE report highlights the looming risk of depreciation for assets heavily reliant on carbon-intensive practices.  

In the evolving landscape, Technology plays a crucial role in data recovery and evaluating ESG criteria compliance. According to CBRE forecasts for 2024, anticipated trends include a focus on: 

  • Social building features benefiting tenants. 
  • Artificial intelligence in the sector’s transformation, especially in the rapid growth of data centers, with a focus on the sustainability of power grids. 

In conclusion, the real estate sector finds itself at the nexus of dynamic shifts influenced by ESG criteria and technological advancements. The imperative adoption of sustainability practices underscores a transformative journey toward a more resilient and responsible industry, poised for the challenges and opportunities that lie ahead in 2024.  

Senior Housing Investments in Response to Europe’s Aging Population 

As Europe is facing an increasing aging population, the impending needs of the baby boom generation will require expanded access to healthcare resources in the coming years. A new outlook on life is materialized through the emerging of senior housing, a new residential model combining housing and specialized medical care, presenting itself as a secure investment. Compounded by government funding cuts across various European nations, the private real estate sector emerges as a vital arena for societal solutions. A Knight Frank report highlights the resilience and appealing performances of the Senior Housing sector, forecasting a notable increase in investments in 2024. 

Cities and Rising Sectors in 2024 

Emerging as “first-tier cities”, Milan, Lisbon, and Madrid are gaining prominence, while London maintains its privileged position due to perceived liquidity and resilience. Paris, securing a notable second place, stands out for its relative resilience and liquidity, driven by factors such as the Olympics and tourist appeal. Despite the divergence in the office market between London and Paris, market by a growing demand for attractive spaces, the most attractive sectors for 2024 are undergoing changes.

Traditionally, robust sectors like commerce and offices have lost attractiveness due to uncertainty, giving rise to new energy infrastructures and data centers as top priority, followed by sectors such as healthcare, student housing, senior living, and co-living, which are also gaining prominence in the evolving market dynamic. 

Sofia part of ISEO, A technological partner for this year

Given the projected trends for 2024, the adoption of the right technology becomes essential. Sofia part of ISEO has invested years in studying the market evolutions in real estate, customizing its solutions to meet the emerging challenges. Aligned with the predominant trend in recent years, the proposed technology has been specially designed for shared and flexible spaces. Its modular and flexible solution is poised to adapt optimally to future changes in spaces. 

Furthermore, the solutions offered by Sofia part of ISEO comply with ESG criteria. The manufacturing process takes place entirely in Europe, ensuring adherence to European laws. Moreover, the goal is to provide cloud-based technology, minimizing the material and components needed for the installation of access management solutions. The simplicity of installation, and the capability of managing locks remotely, reduces the technical and maintenance team’s work.