Denmark Real Estate Market Outlook 2023

Welcome to the 2023 edition of CBRE Denmark’s Outlook report, detailing our perspective on likely trends in each sector of the commercial real estate market in 2023 and the opportunities we foresee emerging for our clients in the year ahead.

It is a difficult time to forecast how the property market will develop. We all thought COVID was difficult, but that was just an interlude to what we are experiencing now. The big challenges are high energy prices, particularly European natural gas prices and higher interest rates. On the other hand, the European economies, in particular the Nordic countries, have performed better than anybody thought they would in 2022.

The trend we are going through tends to make the market think quite negatively. Investors are quiet at the moment; many of them are sitting on the fence. But the change in sentiment will happen at one point. The beginning of 2023 will probably be quiet. In Q2, slowly but surely, investors are likely to get ready again for reallocations, starting to build a pipeline. In the second half of the year, we are expecting to see more deal activity.

The impact of the repricing we are currently experiencing will be substantial, but many indicators point towards repricing being short-lived. It is not going to be the same for all locations and all sectors, but it is going to be material. This is not very good news for those who have invested in the past three years. However, if you are looking to invest, the future suddenly got much brighter. The new equilibrium will be settled among commercial real estate buyers and sellers as well as investor return expectations.

We have produced this report to help you navigate the macro environment we expect in 2023, and we look forward to working with you.