Barclays Favors U.S. Office Sector Over Europe on Valuations

Barclays analysts said the U.S. office real estate sector currently appears more attractive than its European counterpart based on valuations. In a recent note, the bank highlighted that sharp price corrections in the United States over the past few years have pushed office asset valuations to levels that may present opportunities for investors.

The analysts pointed out that the U.S. office market experienced significant declines as remote and hybrid working trends accelerated after the pandemic. This downturn has created notable discounts in certain assets, which Barclays believes could provide compelling entry points for long‑term investors.

In contrast, European office markets have generally held up better in terms of valuations. While that resilience reflects relatively stable pricing, Barclays suggests it also means that upside potential may be more limited compared with the U.S. market, where prices have already adjusted more sharply.

The bank also noted structural differences between the regions. U.S. office leases and market dynamics tend to reprice faster, allowing valuations to adjust more quickly. In Europe, longer lease structures and market characteristics can slow down valuation adjustments. According to Barclays, despite ongoing structural changes in the global office sector, selective investments in high‑quality U.S. office assets—particularly in prime locations—could offer improved risk‑return prospects going forward.