Irish commercial property investment volumes are forecast to increase in 2026 as stabile interest rate expectations and resilient domestic economic growth combine to unlock activity across the market, according to Savills latest Ireland Investment Market – Review and Outlook 2026.

While total investment activity in 2025 reached €2.4 billion, it was broadly unchanged year-on-year and 40% below the 10-year average of €4.0 billion. Momentum strengthened in the final quarter, with €796.6 million transacting in Q4 alone. Savills expects this improving trajectory to continue through 2026.

“One the most promising aspects of the current market is the stability of the interest rate outlook," said Director of Research at Savills Ireland, John Ring.

"It gives investment managers confidence that future path of interest rates will remain predictable and stable from initial deal sourcing and underwriting through to bidding and completion. This helps the market to arrive at a consensus, narrowing bid-ask spreads and facilitating deal flow."

He added, "This is in sharp contrast to the volatility witnessed between 2022 and 2024, when repeated inflation adjustments led to uncertainty with regards interest rates and hamstrung activity."

Institutional investors accounted for 62% of acquisitions in 2025, their highest share on record, underlining the increasingly diversified nature of Ireland’s capital base.

European investors were the most active buyers, responsible for 36% of purchases, followed by US and Irish buyers at 25% and 24% respectively.

French SCPI funds were particularly influential in the €20 million to €50 million segment, where they accounted for 35% of activity in 2025, and 27% of deals between €5 million and €10 million. Their investment reached a record €342.1 million, up 30% year-on-year.

Retail was the largest sector by market share for the second consecutive year, accounting for 30% of volumes, ahead of its 10-year average of 21%. Offices recovered to 27% of volumes, up from 20% in 2024, while residential accounted for 24% - from 18% - driven by a partial recovery in PRS and PBSA investment. Yield tightening resumed across most sectors in the second half of 2025.

Since 2012, Savills clams Ireland’s commercial property market has undergone a structural transformation, shifting from a domestically concentrated capital base to a more geographically diversified ownership structure. Institutional investors were the largest net purchasers over the period, with a net position of €8.4 billion, followed by private equity at €6.1 billion.

Furthermore, Modified Domestic Demand grew by an estimated 3.9% in 2025, underscoring the resilience of the domestic economy despite global uncertainty. Meanwhile, Ireland’s sovereign bond spread over Germany tightened to just 20 basis points at year-end, reinforcing investor confidence in Ireland’s fiscal position.

Savills concludes that while volumes remain below long-term averages, the combination of stabilised forward rates, increased sales supply and a diversified institutional capital base provides a very positive backdrop for Irish investment markets in 2026.

“We are seeing the foundations for a more active year ahead. There is capital ready to deploy, particularly from institutional and continental European investors, and the return of larger lot sizes is encouraging," said Kevin McMahon, Director, Investments at Savills Ireland.

"Crucially, the market structure today is fundamentally more resilient than it was pre-GFC. Ownership is more diversified by geography and investor type, and that depth of capital will support liquidity as sales by private equity materialise."

He added, "We expect 2026 to mark the beginning of a more normalised investment cycle, with increased price transparency and stronger deal flow, particularly in sectors where income growth prospects are robust.”