German Commercial Real Estate Prices Decline in Second Quarter

Commercial real estate prices in Germany declined in the second quarter of 2026, reversing a fragile recovery seen earlier in the year. Data from the VDP banking association shows that prices for retail buildings and offices fell 1% compared to the previous year, following a modest 0.5% gain in the first quarter.

Jens Tolckmitt, CEO of VDP, attributes this downturn to rising interest rates and inflation driven by geopolitical conflicts in Iran and the Middle East. He noted that the commercial market is reacting more strongly to these developments than the residential market, which saw prices rise by 1.9% during the same period, though this growth slowed from 2.3% in the first quarter.

Tolckmitt suggests that the future of the commercial real estate market depends on the resolution of ongoing global conflicts.