- Residential investment transaction volume reached €2.22 billion in Q2 2026, up from €1.71 billion in Q2 2025
- Prime yield remains stable at 3.80 per cent, with a continuing trend towards yield compression
Cushman & Wakefield recorded a transaction volume of €2.22 billion in the German residential investment market during the second quarter of 2026, representing an increase of 30 per cent compared with the same quarter of the previous year (€1.71 billion). The half-year comparison also showed growth, albeit at a more moderate pace. Transaction volume in H1 2026 reached €4.10 billion, an increase of 6.5 per cent compared with the first half of 2025 (€3.86 billion).
Jan-Bastian Knod, Head of Residential Investment Germany at Cushman & Wakefield, commented:
“The increase in market activity is particularly evident in the growing number of portfolio transactions, both regional and nationwide. At the same time, international investors are increasingly focusing on large-scale deals as a means of establishing a foothold in the German market.”
Growing activity in the residential investment market: more international capital and higher portfolio transaction volumes
While single-asset transactions dominated the German residential investment market in the first quarter of 2026, portfolio transaction volume rose by almost 130 per cent, increasing from €450 million in Q1 to €1.03 billion in the second quarter.
Domestic capital continues to focus predominantly on individual transactions or strictly local portfolios. One example is the acquisition by Next Generation Invest of a residential development portfolio from Delom in Frankfurt. The portfolio comprises six apartment buildings with a total of 290 residential units, scheduled for completion between 2027 and 2029, with a total estimated investment volume of approximately €120 million. The transaction also confirms a broader market trend: development projects and forward-funding transactions are becoming increasingly attractive to institutional investors seeking early access to high-quality newly built residential assets.
International capital, by contrast, is increasingly targeting geographically diversified portfolios to achieve larger-scale investment volumes. Net Zero Properties acquired a portfolio from Ares and Forte consisting of assets located across northern Germany. The portfolio comprises more than 1,000 residential units with approximately 57,800 sq m of lettable space. Forte also participated on the buy-side of another transaction. Together with Tikehau, it acquired a portfolio of five properties comprising approximately 300 apartments from MEAG, including assets in Frankfurt, Düsseldorf, Cologne and Bonn.
The increase in overall transaction volume compared with the first quarter of 2026 was driven primarily by a significant rise in the absolute volume of international capital invested. Capital originating from international sources increased by €428 million quarter-on-quarter.
As a result, international investors accounted for €893 million, or 40 per cent of total transaction volume, during the second quarter alone. Investments backed by domestic capital sources totalled €1.33 billion, representing the remaining 60 per cent.
Student housing and micro-living: international investors increasingly target development projects and platforms — higher activity expected to drive volumes in the second half of the year
International capital is also showing growing interest in the student housing and micro-living sector. Jan-Bastian Knod commented:
“New investment vehicles, some pursuing entirely new strategies, are actively assessing the German market. Their focus is primarily on the Top 7 cities and major university locations.”
Despite this increasing interest, transaction volume in the student housing and micro-living sector totalled only €71 million during the first half of 2026. One example is the acquisition by Home & Co of a student accommodation development in Berlin-Spandau, comprising approximately 300 apartments. The project is being developed by Felix Dierken Beteiligung and Bungs Patzschke Projektentwicklungs GmbH, which have already commenced construction. Completion is scheduled for the first quarter of 2027.
Knod continued:
“Based on current market activity, we expect transaction volumes in this segment to increase during the second half of the year. Against a backdrop of limited product availability, investors are adopting new strategies and increasingly creative solutions. In particular, securing an early position in high-quality, centrally located development projects once again appears to be an effective approach and could further accelerate market activity.”
Meanwhile, the IC Campus platform remains on the market. Given its scale, the proposed OpCo/PropCo transaction—combining an operating company with a real estate holding company owning the underlying physical assets—is considered particularly attractive to international investors seeking entry into Germany.
Concluding his assessment, Jan-Bastian Knod said:
“The market is gradually gaining momentum, and this is increasingly being reflected in a growing number of completed transactions. Alongside domestic investors, who are also becoming more active, international market participants are showing a rising appetite for German residential investment products and are successfully gaining market exposure. Large-scale portfolios, student housing and micro-living projects, as well as platform transactions, are currently attracting the greatest attention.”
Against this backdrop, Cushman & Wakefield expects a dynamic second half of the year, with transactions of this type likely to shape market activity. According to Jan-Bastian Knod, the period of price stabilisation has now clearly come to an end.
