Italian property market: record first half with 7 billion euros of investment

According to the analysis by the Dils research team, the Italian property market reached an investment volume of 7 billion euros in the first half of 2026, marking the best result since records began.

The figure highlights growth of 28% compared with the first half of 2025 and of 62% compared with the average of the past ten years, confirming the robust strengthening of investment activity in the national market.

Following an already particularly positive start to the year, the second quarter provided a further acceleration in transaction volumes, contributing approximately 4,3 billion euros and recording an increase of 56% compared with the first three months of the year. This trend demonstrates investors’ growing interest in Italian real estate and the market’s ability to attract capital.

Retail asset most dynamic

Retail was confirmed as the most dynamic asset class in the first half, attracting approximately 2,3 billion euros of investment. The second quarter recorded the segment’s best quarterly performance ever, with volumes of 1,6 billion euros. The market benefited in particular from several extraordinary transactions involving trophy assets: more than 80% of the capital invested was attributable to two major share deals relating to the property on Via Montenapoleone 8 in Milan and a pan-European outlet portfolio with significant exposure to the Italian market, including Serravalle Designer Outlet and Castel Romano Designer Outlet. At the same time, there was renewed momentum in the Shopping Centre segment, which, after years of more limited activity, has once again attracted strong investor interest. Over the past twelve months, the segment has attracted more than 1 billion euros of investment, confirming the sector’s appeal.

Logistics accelerates

The logistics sector also recorded strong acceleration in the second quarter, with approximately 770 million euros invested, taking first-half volumes to nearly 1,2 billion euros. This is the best result recorded in the past four years and represents growth of approximately 50% compared with the same period of 2025.

The performance was driven mainly by three significant portfolio acquisitions by international institutional investors, which accounted for approximately 75% of quarterly volumes. One exceptional transaction stands out among them, constituting the largest transaction ever completed in Italy for a portfolio of logistics properties in terms of capital invested.

Demand for logistics space remained particularly strong in the second quarter as well, with take-up of approximately 730.000 sq m, bringing first-half absorption to approximately 1,6 million sq m, the highest level ever recorded in Italy for the first six months of the year.

Over the past twelve months, absorbed volumes exceeded 3 million sq m, a level never previously reached by the Italian logistics market. Activity was concentrated mainly in the principal logistics hubs of northern Italy, with Lombardy and Emilia-Romagna accounting for approximately two thirds of total quarterly absorption.

Retailers made a particularly significant contribution, featuring in three of the four largest transactions completed during the period. Strong demand for quality space also continued to exert upward pressure on prime rents, which in the second quarter of 2026 reached 73 euros/sq m/year in the Milan market and 72 euros/sq m/year in the Rome and Bologna markets.

1,1 billion euros of investment in hospitality

The hospitality sector attracted approximately 1,1 billion euros of investment during the first half of 2026, of which more than 660 million was concentrated in the second quarter, up 55% compared with the first three months of the year. Despite a slowdown compared with the exceptional performance of the first half of 2025, the segment continues to show particularly robust momentum, with volumes 23% above the average of the past ten years. While the two highest-value transactions of the quarter were completed in Rome, Milan proved to be the most active market, attracting approximately 40% of the capital invested during the period. At the same time, investor interest also extended to the main Alpine destinations in Valle d’Aosta and South Tyrol, demonstrating the growing attractiveness of markets linked to high-end tourism.

Offices: 84% of investment between Milan and Rome

The office sector recorded an investment volume of approximately 880 million euros in the first half of 2026, up 13% from approximately 780 million euros recorded in the same period of 2025. Second-quarter activity focused on medium- and small-sized transactions in the Milan and Rome markets, with the exception of the contribution from the office component of the property on Via Montenapoleone 8. Overall, the two main Italian markets accounted for 84% of national investment during the half-year, with Milan representing 50% of total volumes and Rome 34%.

Living among the most active sectors

The living sector continued to consolidate its role among the most dynamic asset classes in the Italian market, with an investment volume of approximately 730 million euros in the first half of 2026, of which approximately 340 million was recorded in the second quarter. This is the best result of the past ten years and represents growth of 69% compared with the same period of 2025.

Quarterly activity was driven mainly by new developments or the repositioning of existing assets, confirming investors’ growing interest in value-enhancement strategies aimed at expanding and upgrading the residential offering. In this context, the student housing segment stands out for its particular dynamism, with volumes approaching 300 million euros, almost three times the previous year’s figure, reflecting investors’ strong interest in a market characterised by structurally high demand and a persistent shortage of beds in the main university cities.

179.654 transactions in the residential sales market

In the first quarter of 2026, 179.654 transactions were completed in Italy in the residential sales market, representing growth of 4,4% compared with the same period of the previous year. After the peak in 2025—which had marked the second-best result of the decade in terms of the number of transactions—growth appears to have stabilised. Nationwide, new-build properties accounted for 6% of transactions in the first quarter of 2026, down from 7,9% recorded in the fourth quarter of 2025. The figure remains significantly higher in the major cities: Milan stands at 11,6%, while Rome reaches 9,5%.

The financial context remains broadly favourable, albeit amid uncertainty caused by international tensions. In the first quarter of 2026, average mortgage rates stood at 3,57%, up 6 basis points from the previous quarter. The share of purchases financed with a mortgage rose to 47,8% nationwide, in line with the growth observed in the first three quarters of 2025.

As regards residential rentals, the national picture remains stable, with differing trends among the main urban centres. Compared with the first quarter of 2025, standard contracts (4+4) recorded a slight increase in Rome (+1,2%) and a further decline in Milan (-13,2%). The two cities also showed opposite trends in total rental income: Rome recorded growth of 8,8%, while Milan saw a reduction of 6,2%. The same trend was confirmed in the temporary-contract segment, whose number rose by 6% in Rome and fell by 4,9% in Milan. By contrast, subsidised contracts are spreading increasingly rapidly, especially in Milan, both in the long-term and temporary forms.

Major transactions in the data centre segment

The Alternative and Mixed sectors confirmed their significant contribution to investment activity in the second quarter as well, with volumes of approximately 410 million euros, taking the half-year total to nearly 890 million euros. The performance was supported by several major transactions completed in the data centre segment, which continues to benefit from strong investor interest, as well as in the leisure segment, where the acquisition of the Unipol Forum in Assago stands out.

Investor diversification

The record result recorded in the first half of the year confirms the strengthening of the Italian property market and its growing ability to attract domestic and international capital. In a global context that continues to be characterised by uncertainty, Italy stands out for the consolidation of its market fundamentals and its competitive profile within the European landscape. This trend places the country alongside the other major Southern European markets, such as Spain, Portugal and Greece, which are benefiting from growing attention from the international investment community.

A distinctive feature of the current market phase is the broad diversification of the investor base. Alongside core institutional operators, focused on long-term strategies, and value-add and opportunistic investors, focused on development and value-enhancement initiatives, there is a growing presence of private capital associated with large family offices. The complementarity of these different types of investor contributes to increasing market dynamism and supporting the development of new areas of investment.

This article was translated from the original Italian version with the assistance of artificial intelligence. In case of discrepancies, please refer to the original Italian version.