2025 went down in the history of the Czech investment market as the most successful year ever. The total volume of investments reached a record €4.3 billion, significantly exceeding the previous highs from 2016 and 2017. Domestic capital and Czech real estate funds, which dominated across sectors, played a key role.

A strong fourth quarter capped off a record year

Q4 2025 alone brought in €1.84 billion in investments, which is the second-highest quarterly result in the history of the Czech market. Compared to Q3, this was a significant improvement, but given the length of time it takes to close transactions, this result was expected.

Mixed-use properties accounted for the largest share of transaction volume in Q4, at 43%. This was mainly due to the sale of the Palladium shopping center. Office properties followed with 29%, followed by hotels, industrial, retail and residential projects.

"2025 confirmed the extraordinary strength of domestic capital. Today, Czech investors are able to carry out very large and complex transactions that were the domain of foreign players just a few years ago," says Josef Stanko, director of market research at Colliers.

One of the most significant transactions at the end of the year was the sale of the premium shopping center, Palladium, which combines retail and extensive office space and is located at the beginning of Prague's main shopping street. The buyer was Reico.

Another significant transaction involved the sale of the Harfa Business Centre B building, which Kaprain sold to the Ministry of Finance. This is one of the first cases in which the state has invested in a modern office building that meets current requirements for quality of working environment and energy efficiency. This step may also be related to the requirements of European taxonomy and pressure to modernize public administration.

The sale of Česká spořitelna's current headquarters in Prague 4 also attracted attention. Three buildings above the Budějovická metro station were acquired by Penta Real Estate in a joint venture with the owner of the DBK shopping center. The transaction opens up space for the transformation of the entire area into a modern urban district with a residential function.

Other completed transactions include Campus Science Park in Brno, Forum Karlín in Prague 8, Aventin Shopping Znojmo, and the Ibis and Diplomat hotels. "All of these projects were completed using Czech capital, which dominated the market throughout the year. In total, over 100 transactions took place in 2025, confirming the market’s extraordinary activity," adds Josef Stanko.

Prices and yields: stability and selective compression

Prime yield indicators remained largely stable in Q4 2025, with slight compression in the most liquid segments.

The prime yield for office properties remained at 5.25%, representing a year-on-year decline of 25 basis points and signalling renewed investor interest. Yields on premium industrial properties similarly declined to 5.00% (also down 25 basis points year-on-year), thanks to sustained rental demand and robust market fundamentals. In contrast, yields on premium shopping centers remained stable at 6.00%, reflecting unofficial transaction data and continued conservative pricing for larger retail formats. Yields on premium retail properties on main shopping streets remained unchanged at 4.50%, thanks to strong tenant demand and the resilience of Prague's prime commercial locations.

Price dynamics continued to be influenced primarily by capital costs and expected returns, taking into account degree of risk. Segments with transparent rental results, specifically logistics and offices in city centers, saw the most noticeable decline in yields, with investors selectively returning to the market where prices had already adjusted earlier in the cycle.

In the industrial sector, yield development was boosted by solid rental growth and persistently low vacancy rates. This enabled sharper pricing than in other commercial sectors. The prime industrial yield of 5.00% in Q4 2025 reflects both strong competition in bids for modern logistics portfolios and growing interest among institutional investors in stable, income-generating assets.

"Overall, it can be said that the Czech investment market is transitioning from overvaluation to an initial phase of growth, with yields on premium properties remaining stable and selective compression indicating improving investor sentiment," explains Josef Stanko.

Investment activity indicates a continuation of strong performance

Investment activity in 2026 should remain strong, thanks to the continued ability of Czech funds to raise and deploy capital. Approximately €1.5 billion in equity capital is currently available, and further fundraising is in full swing. This will ensure sufficient liquidity to support deal-making throughout the year. In addition, the identified transaction pipeline worth approximately €3 billion signals that market dynamics are not only expected but are already becoming a reality. Czech capital will continue to play a dominant and stabilizing role, benefiting from its deep knowledge of the domestic market and strong investor confidence.

"However, market dynamics will be strongly influenced by limited supply, especially in sectors where development activity remains limited. Offices are expected to account for the largest share of transactions, thanks to higher tenant demand and limited supply of quality properties," concludes Josef Stanko.