Global Outlook Europe

Investment Perspectives - Europe Overview

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Investment Perspectives: Europe Overview

The series of shocks and 'Black Swan'-type events that have hit financial markets and economies over the past few years have not been unique to Europe.

Yet for a variety of reasons their effects have been stronger here than in other global regions1. For example, Russia’s invasion of Ukraine hit close to home (directly impacting vital supply chains), while Europe’s dependence on Russian gas left it exposed to the spike in global energy prices. The global monetary policy response to high inflation has also impacted Europe more than elsewhere, as higher rates and quantitative tightening have sent shockwaves through the money supply and credit flows1. Combined, these events have dealt a sustained blow to investor sentiment, economic growth, and overall risk appetite.

Given this backdrop, it is not surprising (in our opinion) that of the three global regions covered by Hines Research, Europe is perhaps closest to falling into a mild recession. It may already be there – according to Eurostat, euro area real Gross Domestic Product (GDP) contracted by 0.1%2 in the third quarter.

1 globalEDGE, Recession in Europe: how the Continent's Top 3 Economies are Faring, Cameron Levis, September 28, 2023

2 Eurostat, EuroIndicators, November 14, 2023

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Alex Knapp
CIO, Europe
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Investment Impacts

From a real estate investment perspective, what has really changed in the past year? European markets are still working through a major cyclical reset on par with those of the Global Financial Crisis (GFC) and the early 1990s recession. Hines Research expects the number of distressed sales to accelerate in 2024 and remain elevated through 2026.

Download the Europe Overview to discover what silver linings exist to present quality investment opportunities.

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The content herein and in the report is provided for informational purposes only. Nothing above or in the report constitutes investment, legal, or tax advice or recommendations. Such content should not be relied upon as a basis for making an investment decision and is not an offer of advisory services or an offer to invest in any product or asset class. It should not be assumed that any investment in an asset class described herein will be profitable. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice. Opinions or beliefs expressed in these materials may differ or be contrary to opinions expressed by others. Certain information above and in the report has been obtained from third-party sources. Hines has not independently verified such information.