As I write this the conflict with Iran is into its 5th week. On Global calls, at conferences & at the office water dispenser the most often used wording is that real estate capital markets activity is showing “resilience”. Transactions are either proceeding or language like “paused not cancelled”, “drifted sideways” is being used, but how quickly could that change? Across the Globe we are gathering real time intelligence on transactions & also looking to leading indicators from the broader economy, & areas within our sphere like the occupier markets where “softness” & “decision making delays or cancellations” might show up first. Accordingly, an article at this moment in time is in danger of aging fast & not in a favorable way!
We have therefore focused in this edition on the tools needed to help underwrite any specific transaction. Market Data, “How to Guides” on being Acquisition ready & also our leading research into the arena of AI. More on that below & via the links to our AI Barometer & AI Impact Hub.
The second area of focus in this edition that is more specific to the Real Estate sectors & mitigating risk in investment decisions is our focus on Alternatives which display many structural & demographic tailwinds. We hosted an extremely well-attended & informative Living Leaders dinner in March which my colleagues Josh reflects upon.
Secondly, we have deepened our insights on the Life Sciences sector, with the angle that the progress China is making in all aspects of R&D, product development & licensing should be viewed through a Global lens rather than confining the thinking to the domestic (China) real estate market.
Navigating Conflict & AI successfully (an unexpected word combination & heading!)
Most discussions around AI & real estate are necessarily forward‑looking. They are about how demand might evolve, which assets benefit, & where long‑term risk accumulates. That remains the right analytical horizon. But investors also need to anchor those structural themes in what is happening now.
The current environment is a reminder that capital markets are not shaped by technology alone. Geopolitical risk has reasserted itself as a near‑term variable, with energy markets once again acting as the transmission channel. Disruption around the Strait of Hormuz has pushed oil prices higher, tightened financial conditions at the margin, & reintroduced volatility just as global real estate markets were beginning to regain momentum.
The key point for investors is this. These dynamics are cyclical & near term (we hope!). They influence pricing, liquidity & timing. AI is structural. It alters how space is used, which assets remain relevant, & how cash flows compound over a decade.
Commercial real estate enters this period of uncertainty from a stronger position than in previous shocks. Values have largely reset, leverage is lower, debt markets are functioning, & leasing fundamentals are improving across most sectors. In that sense, today’s volatility is a test of resilience rather than a reset of the cycle.
For Asia Pacific, the distinction matters. The region is more exposed to energy prices than many Western markets, which means short‑term pressure on costs, margins & sentiment. At the same time, APAC remains a core beneficiary of structural demand tied to logistics, living sectors, urbanization & network resilience. That combination makes asset selection more important than market selection.
This is where long‑term AI themes intersect with near‑term reality. Assets that already support flexibility, reliability, decision speed & service delivery are better positioned to absorb cyclical shocks. Assets priced for older operating models are not.
Investors do not need to choose between short‑term risk management & long‑term conviction. The opportunity is to do both. Navigate near‑term volatility with discipline, while underwriting clearly for the structural changes that will define portfolio performance over the next decade.
