Savills: Investor appetite grows for co-living, single-family and senior living

Investor demand for operational real estate sectors across Europe is continuing to broaden, with rising interest in co-living, single-family housing and senior living, according to Savills’ latest European investor survey.

The fourth annual study by Savills and Savills Investment Management, which surveyed investors representing €540 billion in real estate assets under management, found that purpose-built student accommodation (PBSA) remains the most sought-after operational real estate asset class for the second consecutive year.

However, the research indicates that investors are increasingly targeting a wider range of living sectors as markets mature and diversify.

PBSA topped the list of preferred sectors, with 58% of respondents identifying it as a priority investment target. Multifamily housing followed at 52%, alongside single-family rental homes, which also attracted interest from 52% of investors.

Interest in co-living continues to grow, with 50% of investors now targeting the sector, up from 42% in previous surveys. Senior living and care homes have also seen increased attention, each attracting interest from 42% of respondents as demographic trends drive demand for specialist residential accommodation.

The survey highlights the growing importance of operational real estate (OpRE) in institutional portfolios, with investment in these sectors accounting for a rising share of total real estate allocation. Since 2022, OpRE investment has increased from 30% to 38% of total real estate investment across Europe.

Geographically, the UK and Ireland were identified as the top target markets for investors over the next three years, followed by the DACH region (Germany, Austria and Switzerland) and Southern Europe including Italy, Spain and Portugal.

Investor strategies are also evolving. While 58% of respondents still prefer direct investment or joint venture structures, the survey recorded a resurgence in interest in fund-based investment vehicles. Around 23% of investors now prefer accessing operational real estate sectors through funds, compared with just 8% in 2025.

Marcus Roberts, head of Europe for Savills operational capital markets, said respondents are looking to deploy around €45 billion into operational real estate sectors over the next three years, with activity expected to peak in 2027.

Savills said improving investor sentiment suggests capital is gradually returning to European real estate markets, although investment decisions remain increasingly focused on income resilience and strong underlying fundamentals.