Europe’s real estate market will see more traditional investment than over the past few years, according to a recent report by commercial real estate services firm CB Richard Ellis.

Investors will focus on long-term returns and more conventional methods of generating profit, such as buying quality buildings in good locations that benefit from strong demand and rental growth.

“For many investors who found it difficult to identify value in the market over the last few years, this will be a welcome return to a pricing environment in which investors are properly rewarded for taking risks that they can understand and manage, and for adding value to their assets,” said Dr Nick Axford, head of the research and consulting department at CB Richard Ellis and one of the authors of the report.

According to the report, the level of investment transaction activity is expected to pick up over the course of 2009, with more vendors looking to sell and investors looking to take advantage of attractive buying conditions.

Occupiers, in contrast, will be able to take advantage of greater choices of rental spaces, lower rental rates and landlords who are keen to negotiate in order to rationalize or improve their operational portfolio.

“All in all, the market will look very different to what we have become used to,” Axford added.