At the end of the first quarter, the Cologne-based investment market can report a positive interim balance: with a transaction volume of around €256 million, the very low result from the same period of the previous year was exceeded many times over (+195%). Even though sales in the first quarter are still based on comparatively few sales and only serve as a first benchmark, there are some indications that speak for an overall positive market sentiment. This is the result of the analysis by BNP Paribas Real Estate.
On the one hand, the strongest start to the year since 2022 was recorded. On the other hand, the cathedral city has also recorded a respectable volume in a comparison of cities, with the exception of Munich (€740 million), all top markets in a relatively narrow range between just under €170 million and a good €420 million. The largest transaction in the Cologne market is an office property of around 30,000 m², which changed hands in the MediaPark for around € 90 million.
In terms of prime yields, only retail high-street properties were unable to maintain their high price level at the beginning of the year (4.00%; +10 basis points). For office and logistics properties, on the other hand, at 4.40% and 4.50% respectively, the same values for top assets in the best locations are still to be applied as at the end of 2025.
Office investments with a slight tailwind
Against the background that only three months have been included in the distribution of volume by property type, size class and location, it is not unusual that some segments, such as the retail or hotel divisions, have currently remained unoccupied.
“Office properties, on the other hand, dominated the market, accounting for a good 79% of investment activities. In addition to the above-mentioned large-volume office transaction in Media-Park Cologne, a number of smaller and medium-sized properties in very different locations in the Cologne city area were sold. Even though these investments are not yet decisively reflected in the result and deals in the three-digit million range are still rare nationwide, they still send a positive signal for the slow market recovery in this sector. In addition, they are also responsible for the highest share of revenue in the city of Cologne compared to the location, at a total of a good 52%. In addition to office assets, logistics investments were also registered, which currently stand at just under 21% due to isolated sales,” explains David Braun, Cologne branch manager of BNP Paribas Real Estate GmbH.
Across all asset classes, the average deal volume is currently around
€28 million, with market activity in terms of deals almost exclusively in the size classes up to €50 million (almost 90% of all transactions).
Prospects
Even though market conditions remain challenging and are likely to remain so for the time being, Cologne can look back on an overall successful start to 2026 at the end of March. Last but not least, the significant year-on-year recovery in sales and the good position in the location ranking are positive indications of the dynamic investment activities in the NRW metropolis. Especially on the side of office investments, Cologne was on a par with the absolute top locations in the first quarter.
To ensure that the outlook remains positive, the development of the geopolitical trouble spots will depend above all, which, as in the past, can influence financing conditions at any time. In uncertain times, demand is likely to continue to focus on core investments in established micro-locations such as Cologne city centre or the outskirts of the city. To the extent that the size segment of € 50 million or more in particular can continue to drive sales up in the second quarter and geopolitical developments do not slow down the market, the chances of a pleasing balance sheet in the middle of the year are good.
“The further development of prime yields remains to be seen for the time being. In the first quarter, however, there were only indications in the retail segment that led to a slightly upwardly adjusted yield level in the current year,” says Lars Faßbender, Cologne branch manager of BNP Paribas Real Estate GmbH.
Link to the market report: https://www.realestate.bnpparibas.de/marktberichte/investmentmarkt/koeln-report
