In 2025, the Portuguese real estate market saw its highest growth in a decade, with a total investment volume of €2.8 billion, a 22% increase over 2024. The fourth quarter alone accounted for €895 million of this amount, marking a strong finish to the year.
International capital remained dominant, representing around 60% of the total investment, according to a Dils report, although domestic funds saw a notable return.
Offices were the most attractive sector, accounting for 39% of total investment, followed by retail and hospitality (both at 19%). The biggest transactions included Exeo Lumnia (€120 million), Torre Oriente (€80 million), and Quinta da Comporta and Maison Albar – Le Monumental Palace (€50-60 million), wrote Idealista/News, citing the Dils report. Yields remained stable across sectors, with some compression expected in industrial & logistics and retail parks.
Pedro Lancastre, CEO of Dils Portugal, noted that despite a challenging economic and geopolitical environment, investment growth reflects investor confidence in Portugal’s real estate market. “Portugal continues to be seen as a safe and competitive destination with demand across multiple sectors,” he added.
Office sector recovers strongly
The office market saw a significant recovery in Q4 2025, with €356 million invested, pushing the annual total to €666 million, a 159% increase compared to 2024. In Lisbon, 72,854m² were occupied in the last quarter, bringing the yearly total to 204,241m², still 8% below 2024 levels. New companies accounted for 30% of the occupied space. The office pipeline stands at 370,000m², with 125,000m² expected to be delivered in 2026, more than half of which are pre-occupied.
In Porto, office occupancy was down 63% year-on-year, totaling 43,700m². The pipeline here is 131,000m², with 75,600m² under construction and 43,200m² due for delivery in 2026.
Retail sector benefits from tourism and spending power
Retail investment grew by 6.4% in 2025, driven by strong tourism and increased consumer spending. Despite limited supply, which hindered the entry of new international brands, the retail sector remained attractive to domestic investors, who made up around 60% of transactions.
Shopping centres saw a 10% growth in sales, while retail parks, with five new projects under construction, continued to draw investor interest.
Hotel investment surges 15%
Hotel investment reached €540 million in 2025, a 15% increase from the previous year. Notable transactions included the sale of iconic hotels in Porto and Comporta. The sector also saw the highest value per room ever recorded for a hotel transaction (Cascais Miragem).
The supply of rooms (+2,900) also reached historic levels, with 2025 being the best in recent years. In the fourth quarter alone, 467 new rooms were added as a result of the opening of seven hotels, notably The Editory Hotels and Tivoli Kopke Porto Gaia, both five-star establishments.
Portugal’s hotel sector continued to grow, with 82 million overnight stays (+3%) and 33 million guests (+2%), with the American market showing the most growth (+7%).
Residential market continues to rise
The residential market saw continued price increases in 2025, driven by an imbalance between supply and demand. The House Price Index rose 4.1% quarter-on-quarter and 17.7% year-on-year. Lisbon remains the primary focus for end users, with prime areas averaging €5,200 per m², and projects up to €350,000 gaining traction.
In Porto, demand from domestic buyers remains resilient and there has been a slight upward trend in sale prices, which averaged €3,700 per square metre.
Further south, the region of Troia, Comporta and Melides has seen a strengthening of domestic demand over the last 12 to 18 months, with prices remaining stable at between €5,000 and €15,000 per square metre.
The Algarve saw strong demand in the mid-range segment, with prices ranging from €5,500 per m² in Portimão to over €13,000 per m² in the Golden Triangle.
