What are the most profitable Real Estate sectors in Southern Europe in 2025?

What are the most profitable Real Estate sectors in Southern Europe in 2025? - Portugal Business News

Real Estate Investment News Europe - Here are the most profitable Real Estate sectors in Southern Europe in 2025 as well as the prime yields, according to the Cushman & Wakefield report published on July 28^th, 2025:

The real estate market in Portugal, Spain and Italy continues to demonstrate resilience and a strong capacity to attract capital, achieving transaction volumes of 12.1 billion euros in the first half of 2025, that is a 32% growth compared to the same period in 2024. 

Here are the most profitable Real Estate sectors in Southern Europe in 2025:

1 – Portugal’s most profitable real estate sectors

Real Estate investment in Portugal for the first half of 2025 reached a total volume of around 1.3 billion euros for the first half of 2025, representing a growth of 70% compared to the same period in 2024.

Portugal is the country with the highest growth in the real estate sector in 2025.

Here is the Ranking of the most profitable real estate sectors in Portugal in H1 2025:  

1 – Commercial sector

Portugal’s commercial real estate market recorded a total investment volume of 1.257 million euros for the first half of 2025, representing a 70% year-on-year increase.  

2 - Retail sector

Portugal’s Retail sector for the first half of 2025 attracted 587 million euros - more than tripling its volume from H1 2024 - with most of this amount concentrated in shopping centers.

 

3 – Hospitality sector

Portugal’s Hospitality sector maintained its appeal attracting 341 million euros for the first half of 2025 and reflecting sustained interest in leisure and tourism assets. 

 

4 – Office sector

Portugal’s Office sector registered investment reaching 163 million euros for the first half of 2025 but still representing only 13% of the total volume.

What are the Prime Yields for Q2 2025 for Portugal’s Real Estate Market?

1 – Industrial & Logistics sector – 5.50%

2 – Office sector – 5.00 %

3 – High street retail sector – 4.25%

2 – Spain’s most profitable real estate sectors

Real Estate investment in Spain for the first half of 2025 reached a total volume of around 5.7 billion euros for the first half of 2025, representing a growth of 16% compared to the same period in 2024.

Here is the Ranking of the most profitable real estate sectors in Spain in H1 2025:  

1 – Hospitality sector   

Spain’s hospitality sector attracted investment reaching 1.6 billion euros for the first half of 2025, that represents a 28% share of the Real Estate Market.

Madrid is a hotspot for renovating obsolete office buildings into hotels and residential apartments.

2 – Retail sector

Spain’s retail sector attracted investment reaching a 28% share of the Real Estate Market for the first half of 2025.

3 – Office sector

Spain’s office sector attracted investment reaching a 24% share of the Real Estate Market for the first half of 2025.

What are the Prime Yields for Q2 2025 for Spain’s Real Estate Market?

1 – Industrial & Logistics sector – 5.00%

2 – Office sector – 4.30 %

3 – High street retail sector – 3.65%

3 – Italy’s most profitable real estate sectors

Real Estate investment in Italy for the first half of 2025 reached a total volume of around 5.1 billion euros for the first half of 2025, representing a growth of 46% compared to the same period in 2024.

Here is the Ranking of the most profitable real estate sectors in Italy in H1 2025:  

 

1 – Hospitality sector

Italy’s hospitality sector attracted investment reaching a 29% share of the Real Estate Market for the first half of 2025.

2 – Retail sector

Italy’s retail sector attracted investment reaching a 24% share of the Real Estate Market for the first half of 2025.

What are the Prime Yields for Q2 2025 for Italy’s Real Estate Market?

1 – Industrial & Logistics sector – 5.50%

2 – Office sector – 4.25 %

3 – High street retail sector – 3.75%