Emerging Trends in Real Estate® 2023

In the Eye of the Storm

Responsible capitalism’, climate change and ‘space as a service’ will shape real estate industry in next 20 years, say industry leaders

Emerging Trends in Real Estate® Europe 2023 shows that Europe’s real estate leaders have a long-term vision for the industry. They expect the most successful firms will adopt ‘responsible capitalism,’ put the user at the centre of attention, break the cycle of demolition and development, embrace ‘mixed-use’ as the norm and deliver ‘space as a service’ across a range of sectors using multidisciplinary and in-house teams. 

This report - the 20th annual survey of European real estate sector leaders’ expectations by the Urban Land Institute (ULI) and PwC, has looked beyond the year ahead at the trends shaping the industry over the next two decades. This report captures the views of over 900 sector leaders from across Europe

Industry leaders report little direct impact on their property portfolios from Russia’s invasion of Ukraine, but the consequences of the war are surging energy costs, high inflation and rising interest rates. Seven out of 10 survey respondents believe Europe will move into recession before the end of 2022.

Sector prospects

With historically high energy prices and the prospect of shortages over winter, it is unsurprising that new energy infrastructure tops the sector rankings in Emerging Trends Europe for the second year in a row. 

Various forms of housing dominate the top 10. On a broad level, the balance between residential supply and demand in European markets has not changed in the past year, and is unlikely to change any time soon. While the security of income from residential is perhaps more certain than from commercial sectors like offices, the leap in construction and labour costs affects residential developers too, restricting supply while demand remains high.

Retirement/senior living is ranked 5th, driven by the growing needs of an ageing population and the fact that COVID-19 showed a lot of older stock in the sector to be obsolete. Social housing, in 4th place (12th last year) has overtaken affordable housing, which sits in 7th place.


Sector prospects in 2023 - Top 10
Rank (2023) Sector
1 New energey infrastructure*
2 Life sciences
3 Data centres
4 Social housing
5 Retirement / assisted living
6 Affordable housing
7 Self-storage facilities
8 Logistics faciliteits
9 Co-living
10 Private rented residential
  * E.g. solar, windm energy storagem electric transportation

“There is much that is positive. The drive for income means the industry is increasingly looking to operational asset types, highlighting the compelling fundamentals of data centres, new energy infrastructure and life sciences. The critical importance of ESG has pushed it up the agenda and despite the obvious challenges - such as increased construction cost - attitudes remain bullish. Overall we’re seeing a sector in flux and it’s clear that the industry is working to surmount these obstacles.”

Grégory Jurion Partner and Real Estate leader at PwC Belgium

City prospects 

Though the city rankings have a familiar look — London retains the top spot while Paris takes over second place from Berlin — with economic uncertainty afflicting the whole of Europe, the overall investment and development prospects for all 30 cities covered by Emerging Trends Europe have declined since last year’s survey.

Where last year there was a unifying, pan-European recovery from the economic consequences of COVID-19, this year’s survey and interviews reveal a much more fractured response to highly challenging market conditions and significant differences in the potential resilience of the cities. Varying prospects for inflation between countries relating to their dependency on fossil fuels for energy, divergent interest rates and distance from the war in Ukraine all play their part. These factors impact cities’ economic performance and their forecasted real estate returns, two of the top three considerations influencing survey respondents when deciding where to invest or develop.

In tandem with these influences, the disruption to patterns of life that accompanied the pandemic has modified the function of cities and the demands on real estate there. In this evolving environment, national and international transport connectivity is also seen as a key influence, and is particularly relevant for those cities that have risen up the rankings this year, notably Paris, Madrid, Lisbon and Copenhagen.

11 (16) Lisbon
12 (12) = Vienna
13 (13) = Dublin
14 (18) Copenhagen
15 (10) Brussels
16 (15) Warsaw
17 (14) Zurich
18 (20) Manchester
19 (19) = Stockholm
20 (17) Luxembourg
Overall prospects
Rank 2023 (2022) City
1 (1) = London
2 (3) Paris
3 (2) Berlin
4 (6) Madrid
5 (5) = Munich
6 (7) Amsterdam
7 (4) Frankfurt
8 (8) = Hamburg
9 (9) = Barcelona
10 (11) Milan

“The real estate sector sees ‘responsible capitalism’ as critical to thrive over the long term. Asked about the factors determining success, 93% of respondents chose running a socially and environmentally responsible business, closely followed by 87% concerned with creating social impact alongside financial return."

"Pressure to incorporate social impact is predicted to grow as public sector balance sheets become increasingly stretched. It seems that real estate is transforming into a service industry that will have to think much harder about a building’s purpose and the objectives of the customer. Property companies embracing ‘responsible capitalism’ will become more involved in providing social infrastructure, public realm, healthcare and community spaces and in addressing loneliness, growing inequality and ageing populations.”

Geoffroy Jonckheere Partner, PwC Belgium

About Emerging Trends in Real Estate® Europe

Emerging Trends in Real Estate® Europe, a trends and forecast publication now in its 20th edition, is a highly regarded and widely read report in the real estate industry. Undertaken jointly by PwC and the Urban Land Institute, the report provides an outlook on investment and development trends, capital markets, cities, sectors and other real estate issues throughout Europe. Emerging Trends Europe 2023 reflects the views of over 900 sector leaders from across Europe.

About the Urban Land Institute (ULI)

The Urban Land Institute is a non-profit education and research institute supported by its members. Its mission is to shape the future of the built environment for transformative impact in communities worldwide. Established in 1936, the institute has over 46,000 members worldwide representing all aspects of land use and development disciplines.

ULI’s mission priorities that the organisation will be focusing on over the next three years include decarbonising the real estate sector and targeting net zero; educating the next generation of diverse real estate leaders; and, increasing housing attainability in communities around the world.

ULI has almost 5,000 members in Europe across 15 National Council country networks. For more information, please visit uli.org, or follow ULI on TwitterLinkedIn or Instagram.

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Grégory Jurion

Partner, Brussels, PwC Belgium

+32 476 42 39 16


Geoffroy Jonckheere

Partner, Brussels, PwC Belgium

+32 475 91 08 29


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