European real estate in 2026: sustainability, rehabilitation and new investment opportunities
- Redação Mudei e Agora
- 3 hours ago
- 2 min read
European real estate in 2026 enters a new phase, marked by greater regulatory demands, changing demand patterns, and evolving investment models. The sector remains a pillar of the continent's economy, but faces challenges such as a scarcity of land for new construction, rising construction costs, and the need to adapt to increasingly stringent environmental and energy efficiency criteria.
Sustainability is no longer a competitive advantage but a minimum requirement. Stricter European regulations on emissions, energy performance, and ESG criteria directly influence property valuations, access to financing, and investor appetite. Assets with poor energy performance risk devaluation, higher vacancy rates, and difficulty in obtaining financing, while efficient buildings are rewarded with lower operating costs and greater liquidity.
In this context, urban rehabilitation and building conversion gain prominence. With significant limitations on expansion in many cities, the focus is shifting towards "making better use of what already exists": transforming obsolete offices into housing, developing mixed-use projects (residential, services, retail), and updating historic buildings with current technology and comfort. These projects require more technical expertise and regulatory considerations, but offer significant added value margins.
Hybrid work models continue to impact the office market. Demand is concentrated on prime, well-located, and highly efficient spaces, while secondary assets need requalification or change of use to maintain relevance. Savills, among other consultancies, anticipates an average increase in prime rents in several European markets, supported by limited supply and rising fit-out costs.
For investors, European real estate in 2026 is less about rapid growth and more about resilience, active portfolio management, and ESG alignment. Funds and listed vehicles are looking for assets capable of meeting environmental, social, and governance targets, otherwise they risk market penalties and restrictions on institutional financing. Data transparency, reporting, and certifications are gaining importance in investment decisions.
Portugal fits into this context as a smaller-scale market, but aligned with these trends. For Portuguese operators looking abroad, understanding European regulatory requirements and the centrality of sustainability is essential to compete on a level playing field. For foreign investors, the country offers the possibility of implementing these strategies in still-growing markets, combining rehabilitation, energy efficiency, and positioning in cities with a strong quality of life component.
Source: Imofinance – “European Real Estate in 2026: Trends, Sustainability and New Opportunities”.
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