The real estate market in 2024: between cyclical crisis and structural change
The year 2024 was marked by many challenges for the real estate sector. While some asset classes, such as old residential real estate, are beginning to show signs of stabilization, other sectors continue to face deep-seated crises. Loïc Hervé, Partner and real estate specialist at IMT Partners, deciphers market trends and shares his outlook for 2025.
The housing market: between stabilization and a new-build crisis
The housing sector in 2024 presents a mixed picture. While the older housing market has seen a significant drop in transaction volumes, it is well structured and should stabilize with the gradual fall in interest rates that will begin in late 2024. Conversely, the new housing market is experiencing an acute crisis, due to a number of factors such as rising borrowing rates, households becoming less self-sufficient and rising construction costs. The social housing sector is also suffering, with 2.7 million people waiting for housing.
The office sector: a two-speed market
As regards the office market, the situation differs according to geographical zone. Central business districts are doing rather well, with low vacancy rates and rising rents. However, outlying areas and inner suburbs are experiencing a drastic drop in transactions and take-up. This phenomenon underlines the fact that tenants are returning to centrality in search of strategic locations.
Resilient sectors: hospitality, logistics and retail
Against this difficult backdrop, some real estate sectors are holding their own. The hotel market has regained a momentum similar to that seen before the pandemic, while the logistics sector, although corrected in terms of prices, continues to perform well, with strong take-up. The retail sector is also showing signs of recovery, particularly in retail parks and high-street retail, despite continuing difficulties in shopping centers.
Healthcare and managed residential real estate: continuing challenges
The healthcare real estate sector has been hard hit by scandals such as Orpea, putting pressure on EHPAD operators. Conversely, private clinics specializing in medicine, surgery and obstetrics are faring better. The managed residential market presents a mixed picture, with good momentum in student accommodation and coliving, but difficulties in senior housing, where the business model is undergoing radical transformation.
Outlook for 2025: return to normal or profound change?
Loïc Hervé anticipates a gradual return to normal for certain asset classes, thanks to the fall in interest rates expected until the end of 2025. However, structural changes in the real estate market, notably in connection with the energy transition and changing usage patterns, are making it more difficult to stabilize the market in the short term, particularly in the new housing and suburban office sectors.
IMT Partners: a key player in real estate transformation
Faced with these challenges, IMT Partners, leader in interim management, continues to support its customers in the transformation of their real estate activities. Thanks to its reinforced expertise in the sector, notably with Loïc Hervé, the company is able to mobilize high-level skills to meet the needs of players undergoing change. Whether restructuring real estate assets, adjusting business models or developing new activities, IMT Partners is ready to provide tailor-made solutions.