Commercial Real Estate - Sweden | Statista Market Forecast

The Commercial Real Estate market market in Sweden is set to achieve a remarkable milestone, with its value projected to surge to US$770.70bn in the year 2024.
This substantial growth is expected to continue, showcasing an impressive compound annual growth rate (CAGR 2024-2029) of 1.31%.
As a result, the market volume is estimated to reach a staggering US$822.30bn by the year 2029.
In a global context, it is noteworthy that the United States will lead the way in terms of Real Estate value, generating an astounding US$25.3tn in the year 2024.
The commercial real estate market in Sweden is experiencing a surge in demand for flexible office spaces.

Definition:

Commercial real estate can be defined as properties that are used for business purposes, such as office buildings, retail spaces, warehouses, and industrial properties.

Additional information:

The commercial real estate market contains the value of commercial properties as a key performance indicator. This is the worth of all office buildings, retail spaces warehouses, and industrial properties for the timeline of our data coverage.

Office buildings
Retail spaces
Warehouses
Industrial properties

Residential real estate
Publicly owned buildings used by the local government
Buildings used for public health care services

The Commercial Real Estate market in Sweden has been experiencing significant growth and development in recent years.

Customer preferences: In line with global trends, customers in Sweden are increasingly seeking sustainable and energy-efficient commercial real estate properties. There is a growing demand for buildings that have been designed and constructed with environmentally-friendly materials and technologies. Additionally, there is a strong preference for properties that offer flexible and adaptable spaces to accommodate changing work dynamics and the rise of remote working.

Trends in the market: One of the key trends in the commercial real estate market in Sweden is the increasing popularity of co-working spaces. This trend is driven by the rise of freelancers, startups, and small businesses that are looking for flexible and cost-effective office solutions. Co-working spaces provide these businesses with the opportunity to work in a professional environment without the long-term commitment and high costs associated with traditional office spaces. Another trend in the market is the growing demand for mixed-use developments. These developments combine commercial, residential, and retail spaces in one location, creating vibrant and dynamic urban environments. The integration of different types of properties in a single development allows for greater convenience and accessibility for residents and businesses alike.

Local special circumstances: Sweden has a strong focus on sustainability and environmental responsibility, and this is reflected in the commercial real estate market. The country has stringent regulations and standards for energy efficiency and green building practices. Developers and investors in the commercial real estate sector must adhere to these standards, which has led to the construction of sustainable and eco-friendly properties.

Underlying macroeconomic factors: The strong and stable economy of Sweden is a key factor driving the growth of the commercial real estate market. The country has a high GDP per capita and a low unemployment rate, which creates a favorable environment for businesses to thrive. The presence of multinational corporations and a skilled workforce further contribute to the demand for commercial real estate properties. In addition, low interest rates and favorable financing conditions have made it easier for investors to enter the commercial real estate market. This has led to increased competition among investors, driving up property prices and creating a vibrant market. Overall, the Commercial Real Estate market in Sweden is experiencing growth and development due to customer preferences for sustainable and flexible properties, trends such as co-working spaces and mixed-use developments, local special circumstances focused on sustainability, and underlying macroeconomic factors including a strong economy and favorable financing conditions.

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.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

After a challenging period during the coronavirus pandemic, the European commercial real estate sector now faces additional pressures, including inflation, record-high interest rates, and sluggish economic growth. In 2022, these challenges were evident through contracting investment volumes in the two largest markets—the United Kingdom and Germany. Although the shifting economic landscape has impacted all commercial real estate subsectors, industrial and logistics—a property type that demonstrated incredible resilience during the pandemic—continues to be the most popular investment class. The performance of the sector is closely tied to the state of the economy, explaining why cities with flourishing capital markets garner the most interest from investors. In 2023, investors identified London, Paris, and Madrid as the three most attractive markets.

Growing demand for industrial and logistic real estate is prominent in Europe, driven by the increase in online retail sales rather than in-store. All the Nordic countries saw steady growth in their e-commerce sales during the past fifteen years and more, and the growth is expected to continue. Investments in the industrial and logistic real estate industry have generally been at a higher level during the last few years. The highest investment value among European countries in the first half of 2021 was in the United Kingdom, while Sweden topped the list among the Nordic countries, and was fifth in terms of industrial and logistics investment in real estate in Europe that year.