Inflation linked downturn for the commercial real estate sector is predicted to have a strong turn around, with the UK tipped to be favourites for investment in Europe, says AEW. The UK's infamous mini-budget set the UK apart as unattractive and unstable for investment across the real estate sector, however, there is hope that commercial real estate should stabalise in the coming years as the inflation peak is now set to fall. This, coupled with global supply chain issues and the global energy crisis have played a central role in the positioning of real estate investment strength across Europe - leaving real estate managers and investors questioning if the peak of inflation has reached its peak and when exactly it will fall.

AEW predicts that inflation should fall across Europe in early 2023, in combination with a brief recession. Commercial real estate investment in the UK is ranking top of the RRR (required rates of return) predictions across Europe. "The UK is ranked most attractive out of 168 covered market segments for the second year in a row on a relative value basis over the next five years, with Benelux second, reflecting an above average share of attractive and neutral markets... the peak of inflation is expected to come back down to below the 2% target adopted by central banks by early 2024 after they hiked rates and initiated monetary tightening, according to Oxford Economics" (UKREiiF). With this in mind, there is a hopeful return to stability for the European real estate sector, with the UK returning to a time of stability.