The PwC and Urban Land Institute (ULI) released its annual report on the top European real estate market.

The top European real estate market for investors is Paris, France. That rank comes from a new report on emerging trends in the European markets from PwC and ULI. Paris is in first place. Berlin and Frankfurt, Germany fill the second and third slots. London, England sits fourth on the list.

Emerging Trends in Real Estate Europe 2020 reveals that technology, regulations, and climate are impacting investment decisions. But the trend that tops experts concerns: Regional and national political instability.

This year, political risk is hitting us, and for the first time in years economic growth being impacted negatively by trade tensions, which is leading to renewed monetary expansion,” said ULI Europe CEO Lisette van Doorn said. “At this point last year, everybody thought interest rates would stay stable, and that has changed dramatically in the meantime.”

Why is Paris at the Top of the List?

Investors like Paris for a variety of reasons. The 2024 Olympic Games are generating buzz. However, it’s the Grand Paris project that has investors hyper-intrigued. France is pumping €26 billion into its infrastructure, including a massive overhaul of the city’s transit system.

Berlin and Frankfurt are expensive markets. That said, van Doorn says that investors see these markets are safe despite the costs.

ULI also said that London remains attractive despite the Brexit worries. Although one of the report’s respondents called investment in London “gutsy,” another cited the city’s culture, arts, the legal system, and stability as reasons to invest.

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