Commercial Real Estate - Nordics

Nordics

The Commercial Real Estate market market in the Nordics is estimated to achieve a value of US$2.27tn by the year 2024.
It is projected to experience a compound annual growth rate (CAGR) of 0.87% from 2024 to 2029, leading to a market volume of US$2.37tn by 2029.
When compared globally, the United States is expected to generate the highest value in the Real Estate sector, reaching US$25,280.0bn in 2024.
Commercial real estate in the Nordics is experiencing a surge in demand for sustainable office spaces.

Key regions: Europe, France, Japan, Brazil, Asia

Market

Region

Region comparison

Currency

Analyst Opinion

The Commercial Real Estate market in the Nordics is experiencing significant growth and development.

Customer preferences: Customers in the Nordics have shown a strong preference for sustainable and energy-efficient buildings. They prioritize environmentally friendly features and are willing to pay a premium for properties that meet these criteria. Additionally, there is a growing demand for flexible office spaces and co-working environments, as companies seek more agile and adaptable workspaces.

Trends in the market: One of the key trends in the Commercial Real Estate market in the Nordics is the increasing focus on mixed-use developments. Developers are integrating residential, retail, and office spaces within the same project to create vibrant and dynamic urban environments. This trend is driven by the desire to create sustainable communities where people can live, work, and socialize in close proximity. Another trend in the market is the rise of technology-driven solutions. Smart buildings, equipped with advanced technologies such as IoT sensors, are becoming more prevalent in the Nordics. These buildings optimize energy consumption, improve operational efficiency, and enhance the overall user experience. The adoption of technology in the Commercial Real Estate sector is driven by the region's strong tech-savvy culture and the desire to create innovative and sustainable buildings.

Local special circumstances: The Nordic countries have a unique geographical location, with a vast amount of natural resources and a strong focus on sustainability. This has led to the development of a thriving renewable energy sector, which has a direct impact on the Commercial Real Estate market. Developers are increasingly incorporating renewable energy sources, such as wind and solar power, into their projects, making the Nordics a leader in sustainable building practices. Furthermore, the Nordics have a stable political and economic environment, which attracts both domestic and international investors. The region's strong social welfare system and high quality of life make it an attractive destination for businesses and individuals. This stability and attractiveness have contributed to the growth of the Commercial Real Estate market in the Nordics.

Underlying macroeconomic factors: The Commercial Real Estate market in the Nordics is also influenced by macroeconomic factors. The region has experienced steady economic growth in recent years, driven by strong domestic consumption, robust export industries, and low unemployment rates. This economic stability has created a favorable environment for investment in the Commercial Real Estate sector. Additionally, low interest rates and favorable financing conditions have made it easier for developers and investors to access capital. This has fueled the construction of new commercial properties and the renovation of existing ones, leading to an increase in supply and demand for Commercial Real Estate in the Nordics. In conclusion, the Commercial Real Estate market in the Nordics is experiencing growth and development driven by customer preferences for sustainable and flexible spaces, the trend towards mixed-use developments, the adoption of technology-driven solutions, and the region's unique geographical and political circumstances. These factors, combined with favorable macroeconomic conditions, have created a thriving market for Commercial Real Estate in the Nordics.

Methodology

Data coverage:

Figures are based on value of commercial real estate.

Modeling approach / Market size:

Market sizes are determined by a bottom-up approach. As a basis for evaluating this market, we use national statistical offices. Next, we use relevant key market indicators and data from country-specific associations such as share of industry, manufacturing, and services of the GPD, price level index, GDP. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the market, for example, exponential trend smoothing.

Additional Notes:

The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.