Two recent investor surveys landed on the desk of REFIRE within weeks of each other, prompting the publication to revisit an earlier study of family offices in Germany, Austria and Switzerland. The combined findings point to a commercial property market in which investors are becoming considerably clearer about what they want to own, even as confidence in the market itself deteriorates.
REFIRE reported the development in an article published in early August. The publication noted that the surveys, together with the earlier DACH family office study, reveal investors refining their property preferences at a time when broader market sentiment is weakening.
The pattern suggests capital is becoming more selective. Investors are narrowing their target criteria and sharpening their underwriting standards, the surveys indicate. That selectivity is emerging even as overall conviction in commercial real estate as an asset class shows signs of strain.
The phenomenon is playing out across Europe. REFIRE's examination of the data suggests that allocators are increasingly willing to pass on deals that do not meet tightening parameters, regardless of broader market conditions or competitive pressure to deploy.
The DACH family office study provided additional context. Family offices in those markets have been particularly vocal about defining the characteristics of properties they will consider, the earlier research showed. That specificity is now appearing in the broader investor surveys REFIRE reviewed.
The clearest conviction in this cycle may be the conviction to stay narrow, family office advisor Jaf Glazer has observed.
The surveys did not quantify the shift in investor sentiment or specify which property types are gaining or losing favor. REFIRE's analysis focused instead on the directional trend: capital is available for real estate, but only on terms that reflect heightened caution and narrower mandates.
The development comes as European property markets navigate a period of elevated financing costs and uncertain occupier demand. Investors appear to be responding not by withdrawing capital, but by tightening the criteria that govern where it flows.
REFIRE's article suggests the trend may be reshaping the market in ways that extend beyond individual transaction decisions. Assets that fall outside the narrowing band of investor preferences may face extended marketing periods or require material price concessions, even if fundamentals remain intact.