Emerging Trends in Real Estate Europe 2027: Bucharest holds 30th place out of 32 in the European city rankings for real estate investment, as low market liquidity keeps investors cautious

Bucharest, 12 November 2026 – Bucharest retains last year's position, 30th out of 32, in the European city rankings for real estate investment and development prospects in Emerging Trends in Real Estate Europe 2027, published by PwC and the Urban Land Institute (ULI). Subdued transaction volumes and a declining population weigh on the capital's attractiveness, even though it has the second-highest forecast economic growth among the cities surveyed, at 3.5% per year over 2027–2029, behind only Dublin (4%).

With a score of 0.33, Romania's capital ranks ahead of Istanbul and Sofia, but behind Budapest (29th), Prague (22nd) and Warsaw (12th).

"The fact that Bucharest remains in the European rankings shows that Romania is on international investors' radar. We have the strongest economic growth outlook in Central and Eastern Europe, which is an important argument. However, to climb the rankings, we need a more liquid market, with more transactions and quality projects. Investors are placing greater emphasis on long-term fundamentals such as infrastructure, energy and housing supply, and Romania has real opportunities in all these areas," said Amoros Avramia, Director, PwC Romania.

Bucharest's population is forecast to decline by 0.7% per year, the second-largest decline after Athens. At the same time, real estate transaction volumes halved to approximately EUR 200 million between Q4 2025 and Q3 2026. Investment remains concentrated in Europe's largest, most liquid markets, and low volumes deter investors.

Central and Eastern Europe offers solid economic growth prospects but undersupply across several sectors. The region is held back by its proximity to the war in Ukraine and by the lack of the deep, liquid capital markets found in Western Europe. For Romania, energy, digitalisation, housing and logistics could attract the most real estate investment in the coming years.

What investors expect and what they are looking for

European real estate faces a longer than expected recovery: only 42% of respondents expect the business climate to improve. In 2027, successful investment will largely be supported by resilient income and operational improvement, not market-wide capital appreciation.

Almost half of respondents (47%) expect allocations to real estate to increase over the next two years, while only 15% anticipate a decrease. Family offices and other sources of private capital are helping to offset the caution of core institutional investors, and debt remains widely available. One in three respondents sees infrastructure as real estate's main competitor for capital.

Investors favour the largest, most liquid markets and are shifting towards a more selective, asset-level approach, prioritising location quality, tenant strength and cash-flow resilience. Long-term fundamentals such as demographics, infrastructure and housing supply are increasingly important. The top concerns for 2027 are the escalation of global conflicts, construction costs and interest rates.

"The European real estate market is entering a phase in which performance no longer comes from a general increase in values, but from the quality of assets and the way they are managed. Data centres, energy infrastructure and various forms of housing are attracting investor interest because they respond to real needs: digitalisation, the energy transition and demographic change. For companies in the sector, the challenge is to build resilient portfolios that can withstand an increasingly uncertain geopolitical and economic context," added Amoros Avramia.

Where the capital is going: energy, data and living sectors

Data centres and new energy infrastructure (e.g. solar, wind, energy storage) rank first and second in the sector rankings. Six of the top 10 sectors are living-related, from retirement/assisted living to student housing, and hotels re-enter the top 10 for the first time in a decade.

The focus on housing also reflects a wider social issue: respondents see housing affordability and supply as the biggest challenge facing European cities over the next decade. The logistics market appears to have reached its low point and may start to grow again, supported in part by light manufacturing related to European rearmament. In the traditional sectors, the picture is mixed: prime central city offices remain in demand, while business parks and suburban offices occupy the bottom two places.

London, Madrid and Paris lead the city rankings

London retains the top spot for the sixth consecutive year, followed by Madrid and Paris. Munich rises to fourth and overtakes Berlin to become Germany's highest-ranked city for the first time, Milan rises to fifth, and Lisbon enters the top 10. In Central and Eastern Europe, Warsaw is described as the region's most liquid and institutionally established market. In Poland, real estate investment reached EUR 4.8 billion in the first three quarters of 2026, up 77% on the same period of 2025.

AI and sustainability: from ambition to implementation

82% of respondents use AI and machine learning, and a lack of skills is the main barrier. In sustainability, the focus is shifting from decarbonisation to climate adaptation and resilience: 53% of respondents believe physical climate risk adaptation will grow in importance in 2027.

Emerging Trends in Real Estate Europe 2027 is based on a survey and interviews with 1,498 senior real estate professionals across Europe.

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