2026 Inside Real Estate Outlook: A Cycle For Selectivity

2026-01-14 09:24:00 ET

Overview

A market defined by divergence is ripe for alpha

Policy shocks, persistent growth. While 2025 is a year that tested the resilience of the global economy, it should be remembered as one of unmatched resilience in the face of headwinds and uncertainty. Trade tensions deepened, inflationary pressures lingered, and geopolitical fractures widened. Yet, against this backdrop of uncertainty, growth endured - powered by strong balance sheets, agile policy responses, and the accelerating march of artificial intelligence. These forces not only defined 2025 but they will also shape the contours of 2026. The United States sits at the epicentre of both global growth hopes and concerns.

The commercial real estate ((CRE)) cycle has moved into recovery by nearly all traditional measures. REIT valuations - often a bellwether for cyclical turning points - have risen broadly since their 2023 trough.

Valuations across most major indices have stabilized, and credit markets are functioning again, helping bolster transaction activity. At the same time, distress - a classic lagging indicator - continues to edge higher, reflecting the long tail of the downturn....

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