72% of Lenders to Increase Real Estate Financing: Lisbon's Living and Office Sectors Lead Demand

In a significant development for Portugal's real estate investment landscape, the latest European Lender Intentions Survey 2026 by CBRE reveals that 72% of lenders plan to increase their financing volumes. This surge in liquidity underscores a robust recovery and growing confidence in the European and Portuguese property markets, signaling a shift from the cautious stance observed in previous years.

The survey highlights a strategic shift in lender preferences, with the Living sector—encompassing residential, co-living, and affordable housing—continuing to lead the way as the most sought-after asset class. However, the most notable change in the 2026 report is the renewed interest in the Office sector, which has jumped from sixth to third place in attractiveness. This trend is particularly evident in Lisbon, where prime office assets in the Central Business District and Parque das Nações are seeing stabilized demand and renewed investor interest.

In the Portuguese context, the market is demonstrating increased maturity and operational sophistication. While traditional banks remain the dominant force in the lending landscape, debt funds are rapidly gaining market share. These non-bank lenders are consolidating their presence by offering greater flexibility, faster execution, and a higher capacity to assume risk in complex development projects. This diversification of funding sources is a critical evolution for developers and investors looking to capitalize on new opportunities in Lisbon and Porto.

The geographic focus remains sharp, with lenders showing a clear preference for established urban hubs. In Lisbon, neighborhoods such as Avenidas Novas and the emerging Marvila district are benefiting from this increased liquidity, as lenders look for projects that align with modern urban living and working trends. The availability of capital is also extending to the Algarve and Porto, though with a more selective approach focused on hospitality and logistics.

Market Implications for Investors

The increase in lender appetite carries vital implications for real estate investors and institutional stakeholders. Higher liquidity typically leads to more competitive financing terms, including tighter margins and more flexible covenants, which can significantly enhance rental yields and overall project viability. The fact that nearly three-quarters of lenders are looking to grow their portfolios is a strong market signal of long-term stability.

For those tracking Portugal's property market insights, the resurgence of the office sector is a key indicator of shifting sentiment. Banks are specifically targeting "Core" and "Core+" assets in prime locations, suggesting that high-quality, well-located properties will continue to enjoy superior access to capital. This creates a clear divide in the market between prime assets and secondary properties, which may still face financing hurdles.

The growing openness to alternative sectors—such as student residences, senior living, and healthcare—provides investors with a broader range of strategic options. With 86% of lenders willing to finance at least one alternative asset class, the barriers to entry for specialized real estate projects are lowering. This is particularly relevant for investors looking for recession-resilient assets with long-term, stable cash flows.

Furthermore, the rise in Loan-to-Value (LTV) ratios for sectors like data centers indicates that lenders are becoming more comfortable with the technical risks associated with these assets. As digital infrastructure becomes a core part of the real estate universe, investors can expect more standardized financing products to emerge, facilitating larger-scale investments in this high-growth sector.

CBRE's Market Analysis and Portugal's Position

CBRE Portugal emphasizes that the national market is becoming increasingly sophisticated, moving away from a purely bank-led model. Igor Borrego, Head of Capital Markets at CBRE Portugal, notes that while residential remains the primary focus, there is a clear trend toward diversifying financing into logistics, hospitality, and student housing.

This sophistication is reflected in the way debt is being structured. Investors are increasingly using a mix of senior bank debt and mezzanine financing from debt funds to optimize their capital stacks. This approach allows for higher leverage while maintaining the stability of traditional bank relationships, a strategy that is becoming common in large-scale Lisbon developments.

The report also underscores the importance of ESG (Environmental, Social, and Governance) criteria in the lending process. Lenders are increasingly offering "green loans" with preferential rates for buildings that meet high sustainability standards. For investors, this means that incorporating green building practices is no longer just a moral choice but a financial necessity to secure the best possible financing terms.

European Real Estate Financing Context

The broader European context shows that despite macroeconomic fluctuations and interest rate volatility, the debt markets remain remarkably healthy. The survey indicates that lenders are looking past short-term inflationary pressures to focus on the long-term structural demand for modern, efficient real estate.

Several factors are driving this sustained lender confidence across the continent:

• Sector Resilience: Continued strong performance and low vacancy rates in the Living and Logistics sectors
• Office Stabilization: Greater clarity on post-pandemic workplace strategies, favoring high-quality prime hubs
• Alternative Growth: High demand for specialized housing driven by demographic shifts and urbanization
• Debt Fund Expansion: Increased competition between bank and non-bank lenders driving innovation in loan structures

In Portugal, this translates to a more dynamic environment for commercial real estate, where well-capitalized investors can find attractive entry points. The maturity of the market is also attracting more international lenders who previously overlooked Portugal, further increasing the pool of available capital.

Investment Considerations

For foreign investors, the availability of diverse financing options is a major advantage when entering the Portuguese market. Whether through traditional local banks or international debt funds, securing capital for Lisbon property acquisitions is becoming more streamlined. However, lenders remain highly selective, prioritizing assets with strong ESG credentials and prime locations.

Investors should use tools like a mortgage eligibility scanner to assess their financing potential early in the process. Additionally, buyers can model the full acquisition cost—including IMT, stamp duty, and notary fees—using tools such as HomeOS's real cost calculator, which is essential for accurate debt sizing and yield projections.

Consulting with English-speaking accountants is also recommended to optimize the tax structure of financed acquisitions, ensuring that interest deductions are maximized and the overall investment is tax-efficient. As the market becomes more sophisticated, the quality of the financial and legal due diligence becomes even more critical for securing favorable loan terms.

Looking Ahead

The outlook for real estate financing in 2026 is decidedly positive, with a clear path toward increased origination and sector diversification. As lenders compete to deploy capital, investors who can present high-quality projects in established sectors like Living or high-growth ones like Logistics and Data Centers will be well-positioned to secure favorable terms.

The resurgence of the office sector, particularly for assets that meet modern sustainability and wellness standards, suggests that the "flight to quality" will remain a dominant theme. For stakeholders in the Lisbon real estate market, the current environment offers a unique window of opportunity to secure financing for strategic acquisitions. For expert guidance on navigating the Portuguese financing landscape and identifying high-yield opportunities, contact realestate-lisbon.com.