Greif & Contzen Immobilienmakler GmbH has published its latest market report about Cologne’s investment market in 2025. There are signs of a recovery, despite the fact that the transaction volume has decreased compared to the year before. Investors continue to be price-conscious, and value-add strategies provide for opportunities.

A transaction volume of around EUR 500 million was recorded in Cologne’s commercial property investment market for the period from January to the end of September 2025. This signifies a decrease by around 54 percent compared to the same period last year. However, this seemingly steep decline has to be seen in perspective: “The acquisition of trade fair halls 6–9 with Congress Centrum Nord and the new office building ROSSIO in Deutz in 2024, represented two transactions amounting to a total of around EUR 640 million,” says Thorsten Neugebauer, Head of Investment at Greif & Contzen Immobilienmakler GmbH. If these extraordinary effects are excluded, there has in fact been a slight increase by just over EUR 40 million when comparing the 2025 figures with those from autumn 2024. “We could observe a slight overall recovery over the course of the year with regard to individual investments, especially in the office space segment. Nevertheless, investors continue to be rather price-conscious and reluctant,” Thorsten Neugebauer explains.

Buyers for office buildings are back, slight pressure on rental income
Sales activities concerning office buildings have become busier over the course of the year. However, purchasing prices remained in the low to mid two-digit million range. Prime yields rose slightly from 4.4 to 4.5 percent. The potential to further increase rents for commercial properties is currently somewhat limited, owing to the increase in vacant space and subdued user demand. Purchasing prices above 20-fold a property’s annual gross income are hard to realise, even for top-quality properties. Many prospective buyers are pursuing value-add strategies in the current situation. These are interested, for example, in affordable office buildings in good locations, which they can develop further to increase their value.

Large-scale deals
Individual transactions worth mentioning include the sale of the Pullman Hotel in the Altstadt-Nord neighbourhood to Pandox for around EUR 66 million. In the Rheinauhafen, Branicks sold an office ensemble comprising Silo 23 and ECR to Pamera Real Estate for over EUR 35 million. A total of around 45 percent of investments were accounted for by office buildings, and this asset class has therefore played a more prominent role once again, than was the case in the same period last year (around 34 percent). However, there were only a few large transactions, and there has been a strong focus on transactions in the mid-price range. Financing of large-scale transactions is further complicated by strict regulatory requirements.

Interest rate situation, financing and yields
Prime yields of 4.5 percent could be observed for logistics, office and retail buildings over the course of the year. Interest rate cuts by the European Central Bank could not fully compensate for the increase in mortgage interest rates since the start of the year, as these are more closely linked to government bonds whose prices have risen, and that are currently quoted at around 2.7 percent (about 2.4 percent in January) in the ten-year segment.

Outlook
The market experts from Greif & Contzen expect that a number of commercial properties will be sold in the fourth quarter, causing the transaction volume to increase considerably. Last year’s result of EUR 1.3 million is, however, unlikely to be matched owing to the lack of large-scale transactions mentioned above. Prime yields are expected to remain stable for the time being, while purchasing prices for existing properties could decrease further in the year ahead. There is currently no indication that mortgage interest rates are likely to decrease. If the political reforms and economic stimuli announced by the government do give rise to a recovery of the economic situation in 2026, this will also cause the investment market to revive in the medium term, for example due to higher demand for space and the initiation new construction projects. Thorsten Neugebauer sums up the situation as follows: “The market offers good opportunities for value-add strategies, and top-quality properties also continue to be of interest. The pressure on purchasing prices will persist for the time being. We are hoping for an economic turnaround to come about next year which would have an impact on the investment market, too.”