Regional Investment Volumes

The CEE-7 investment market recorded approximately €5.4 billion in H1 2026, a headline that looks stable year-on-year (-0.3%) but conceals sharp internal redistribution. Poland alone accounted for 56.7% of regional volume, its strongest first half since 2018, while the Czech Republic corrected from an exceptional 2025 comparison base, falling from the region's largest market to second place. Hungary continued its recovery (+42.6%), while Slovakia, Romania and Serbia all recorded sharp declines from prior-year highs.

The seasonal dip against H2 2025 (-16.1%) is consistent with the region's usual pattern rather than a signal of weakening demand. Average deal sizes rose materially in several markets, and portfolio transactions grew as a share of activity, pointing to a return of larger-ticket liquidity even as overall transaction counts eased slightly across the CEE-7.

Product Scarcity, Not Capital Scarcity

A defining feature of H1 2026 is that supply, not investor appetite, is constraining volume. Several CEE markets show demand for institutional-grade assets outstripping what is being brought to market, a constraint most explicitly visible in the Czech Republic, where investors remain ready to deploy and banks remain willing to lend.

This scarcity is shaping pricing behaviour region-wide: prime, ESG-compliant, long-WAULT assets are seeing competitive tension, with sub-6% pricing emerging in select Warsaw and Prague office deals, while secondary and value-add product continues to be underwritten at materially wider spreads.

Sector Rotation

Office remained the largest sector regionally at 30% of H1 2026 volume, down from 36% in FY2025, as retail (28%, up from 24%) and residential (17%, up from 5%) gained share. The residential shift is anchored by two landmark deals: Poland's Resi4Rent portfolio (€575 million) and the Czech Republic's Písnice residential portfolio (€190 million).

Industrial's regional share fell to 18% (from 26%) against a high 2025 comparison base, and hotel's share eased to 5% (from 9%) in the absence of a 2025-scale portfolio transaction. Retail's rise was driven overwhelmingly by Poland's landmark Posnania transaction and Hungary's return to large-format retail deals.

Capital Sources

CEE-origin capital accounted for 55.0% of regional investment volume in H1 2026, down from 64.8% a year earlier. The decline is concentrated in Czech-origin capital, which fell from 44.5% to 33.3% of regional volume, consistent with the Czech Republic's own steep pullback in domestic activity rather than a broad retreat of CEE capital generally.

Western European capital nearly doubled its regional share, from 12.8% to 22.7%, driven overwhelmingly by Germany (1.6% to 11.4%). US and Canadian capital held broadly steady around 12%, while Hungarian-origin capital rose from 5.5% to 12.1%, reflecting stronger domestic activity and growing outbound participation.

Yields and Pricing

Prime yields across the CEE region remained largely stable in H1 2026, consistent with the pricing equilibrium reached during 2025. Where movement occurred, it was compression rather than widening: the Czech Republic recorded 25-basis-point compression in prime office, industrial and shopping-centre yields, while Poland's industrial yields compressed modestly (-10bp) on continued logistics strength.

The one area of yield widening regionally was Czech retail parks, which moved out 10 basis points, the only outward movement recorded across the region this half. All other country and sector combinations were unchanged since Q2 2025, underscoring the broader stability of the pricing environment.

Outlook

Several regional markets are positioned for a stronger second half than H1 volumes alone suggest. In Romania, a retail portfolio and a logistics asset sale together valued at roughly €530 million were either closed or expected to complete by year-end; in Bulgaria, a c.€122 million cross-border retail transaction remains subject to regulatory approval. Poland's pipeline across office, retail and long-income logistics suggests its current regional dominance is likely to persist.

Domestic capital is expected to remain the primary source of regional liquidity, though the Czech cross-border pullback bears watching given its influence on the broader shift toward Western European capital. Yields are expected to stay stable in supply-constrained markets such as Prague and Warsaw, while secondary spreads continue to widen and Romanian inflation and political risk weigh on regional deal timing.