Czech investors dominated H1 activity. Of the 43 total transactions, 39 were made by Czech investors, representing a 76% share of the total volume. Foreign capital remains cautious, likely due to ongoing geopolitical uncertainty and economic volatility in Europe. In contrast, Czech investors are well-acquainted with the local market and can act swiftly, even as large institutional players remain on the sidelines.

The transaction volume reached €2.1 billion, representing a 187% year-on-year increase and signalling renewed investor confidence. In Q2 alone, transactions totalled approximately €600 million.

“Growing fundraising ability of Czech funds, continued strength of the occupational markets and strategic decision of international investors to exit the country are 3 key factors that lead to a surge in activity in the second half of 2024 and the beginning of 2025. We expect that these factors will continue to define the market with the focus shifting towards the office sector,” comments Michal Soták, Head of the Capital Markets team in the Czech Republic, on the current situation.

In the first half of the year, industrial properties led the market with a 28% share, followed by offices (23%) and hotels (23%). Strong demand for office buildings—especially premium assets in Prague, such as Visionary and Stará Celnice—indicates a stabilising office segment.

The office and industrial sectors were nearly balanced in volume, with €556 million in office transactions and €583 million in industrial. Offices showed a slightly higher prime yield (5.25%) compared to industrial properties (5.00%).
Prime yields (returns from top-quality properties) decreased in the second quarter by 25 basis points for office and industrial assets, and by 10 basis points for retail parks on a quarter-on-quarter basis. Yields for other property types remained stable. This trend reflects growing interest in high-quality assets, particularly in premium locations where strong demand exceeds limited supply, putting upward pressure on prices.

The hotel sector saw significant investment activity, with a total volume of €471 million and the highest prime yield across all segments (6.5%). Of the six hotel transactions completed in H1, the two largest accounted for over 81% of the total volume. These were the sales of two Prague hotels: the ultra-luxurious Four Seasons Hotel Prague and the largest hotel in the country, Hilton Prague Hotel.

"Prague’s hotel sector is increasingly in the investment spotlight, driven by the city’s resilient tourism market, robust economic fundamentals, and a growing appetite for diversification. With limited high-quality assets available, local capital is seizing the opportunity for long-term investment in one of Europe’s most stable and attractive hospitality markets," explained Alina Cazachevici, Head of Hotel Valuation CEE&SEE.