2025 Inside Real Estate Outlook
The authors, including Arthur Jones, Senior Director for Global Research and Strategy, and Daniel Tomaselli, Manager for Global Research, provide exciting insights into the development of global real estate markets and identify potential opportunities for investors.
The turning point in the real estate market
A central theme of the report is the expected recovery of the real estate market, but this is likely to vary depending on the sector. Commercial real estate in particular is showing signs of stabilisation and could become the starting point for a new growth cycle. But be careful: The situation in the office sector remains challenging, and investors are well advised to weigh up the risks carefully.
Top trends for 2025
- Data centers worldwide: Digitization and the boom in AI make data centers one of the most sought-after real estate classes. With almost no vacancies (less than 2%) and rents rising sharply in North America, demand is huge. In the first half of 2024, new contracts for over 3,000 MW were signed worldwide.
- US market for rented single-family homes: A mix of high demand, affordable housing and stable rental income ensures attractive returns. These conditions open up potential for investors to benefit from developments in this market segment.
- European hotel sector: Tourism is booming again – and with it the hotel sector. With a 130% increase in sales compared to the previous year, this market has not only reached the pre-crisis level, but exceeded it.
Special attention to private debt investments
Our Four Quadrant Perspective also looks at debt investments, which are proving to be an attractive opportunity for investors in the current market phase due to high interest rates and stable default rates. Detailed insights can be found in the full article, right after the “Key Themes”.
Focus on sustainability and innovation
Sustainability and technological advances are becoming key drivers of growth in the real estate sector. Projects that embrace these trends have the potential to position themselves as winners.
Fancy deeper insights?
The complete “2025 Inside Real Estate Outlook” goes into detail about the opportunities and risks, provides a macroeconomic analysis and reveals which real estate sectors are worthwhile in the coming twelve months – and which are better avoided.
https://www.principalam.com/us/insights/real-estate/2025-inside-real-estate-outlook
