Q3 2025 has injected fresh optimism into Europe’s retail real estate sector. Across the continent, steady rental growth, rising consumer confidence, and strong demand for both high streets and retail parks are prompting investors to rethink their strategies. As liquidity returns and ECB rates stabilise, yields are gradually compressing, with retail parks and shopping centres in several key markets now well-positioned. The Median Retail Yield Index for Q3 2025, which aggregates data from Poland, Italy, Portugal, the Czech Republic, Spain, the UK, France, and Germany, highlights this alignment and underscores the renewed attractiveness of retail assets for investors seeking stable, long-term returns.
“In Q3 2025, the European retail commercial real estate market showed positive trends with steady rental growth, especially in high streets and retail parks. Leasing activity is accelerating as retail occupiers, particularly in sectors like sporting goods, athleisure, Home and DIY, clothing, and footwear, realise expansion plans. Retail parks stand out with very low vacancy rates, driven by high demand and limited availability. The retail sector benefits from improving consumer fundamentals, including the tamed inflation and rising disposable incomes, which support retail sales growth,” says Oleksandr Romanyshyn, Partner in Focus Estate Fund. “Investment activity and further gradual compression of the yields are driven by stabilised ECB rates and a growing amount of liquidity. Despite moderate investment volumes in Q3, many markets demonstrate not only the alignment of prime yields for retail parks and shopping centres, but also a strong preference for convenience shopping format among investors,” he adds.
“To help navigate this momentum, Focus Estate Fund created the Median Retail Yield Index – a unique, data-driven benchmark built on insights from the industry’s leading advisors and trusted macroeconomic sources. The Index aggregates yield data from Cushman & Wakefield, JLL, Colliers, CBRE, BNP Paribas Real Estate, Savills, Avison Young and Knight Frank, and combines them with macroeconomic indicators sourced from Eurostat, Statista and central bank publications. This comprehensive methodology cuts through market noise and offers a clear, reliable view of where the strongest opportunities truly lie,” sums up Oleksandr Romanyshyn.
