European real estate investment is set to dip slightly in 2012 due to ongoing uncertainty in the global financial markets, according to a new research report issued by DTZ.

In its European Investment Market Update, the London-based division of UGL Services said transactional activity is expected to slow down modestly this year, to EUR 107 bn.

'Looking forward, uncertainties in global financial markets are starting to impact investor sentiment as efforts continue to contain the European banking and sovereign debt crisis. Given this more negative sentiment we are forecasting that volumes will register a small fall in 2012,' said Magali Marton, head of DTZ CEMEA Research.

In 2011, annual investment volumes reached EUR 110 bn, up 7% from EUR 104 bn in 2010. Around EUR 31.4 bn of property assets were traded in the fourth quarter of last year, representing a 17% increase on Q3.

Among Europe's three largest markets, France posted the biggest increase, with an 83% rise to EUR 6.7 bn in Q4. The UK experienced a 14% quarter-on-quarter rise to EUR 8.6 bn while Germany maintained its high level of activity at close to EUR 6 bn.

Elsewhere in Europe, the Nordic markets registered a buoyant final quarter with EUR 4.4 bn invested compared to EUR 2.7 bn in Q3 mostly in Sweden and Norway. Following a strong third quarter, activity in CEE contracted from EUR 2 bn to EUR 1.3 bn in Q4 as investors have become more selective in peripheral markets.