A new report by PwC and the Urban Land Institute (ULI) presents a cautiously optimistic outlook for global real estate, signaling a potential shift despite ongoing geopolitical and economic challenges. The Emerging Trends in Real Estate Global Outlook 2025 report highlights emerging opportunities in sectors like data centres and energy infrastructure, driven by global demand for energy security and technological advancements.
The report notes that despite ongoing inflation, rising interest rates, and political instability, there is a growing sense of optimism in the industry, with market players anticipating a “reset point” and the potential for a new cycle starting in 2025. Transaction volumes are expected to improve as pricing clarity increases, although geopolitical and economic uncertainties continue to cloud the market.
Political uncertainty, including the threat of policy changes, global trade disputes, and regional conflicts, remains a major factor influencing investment decisions worldwide. The report emphasizes how such factors—especially those impacting monetary policy, economic growth projections, and ongoing global conflicts—are shaping financial markets.
While environmental concerns and the ESG (Environmental, Social, and Governance) agenda remain priorities, political pushback, especially from the US, is beginning to influence other regions, including Europe and Asia Pacific. Despite this, 67% of respondents, particularly in Europe, continue to highlight environmental and decarbonisation targets as key concerns.
The report identifies several areas where real estate and infrastructure are converging to present significant opportunities. Sectors such as data centres, energy infrastructure, and logistics are drawing heightened investor interest, driven by the need for energy independence, artificial intelligence-driven expansion, and regional economic resilience.
Although there is increased pricing clarity supporting transaction activity, inflation—particularly in the US—could delay full recovery in the sector. In Europe, the market is on a positive trajectory, buoyed by central bank rate cuts and stable valuations, though geopolitical tensions persist. North America is seeing a boost in transaction volumes, with anticipation of rate cuts, but concerns over inflation and interest rates remain. In Asia Pacific, markets like India and Southeast Asia are showing promise, driven by favorable demographic trends.
Lisette van Doorn, CEO of ULI Europe, remarked, “Our global assessment of real estate investment prospects indicates a strong desire to begin a new cycle, following a period of lower inflation and initial interest rate cuts. However, geopolitical risks and their broader economic effects will create continued uncertainty, requiring ongoing caution. Within this uncertainty, there are areas of opportunity, particularly driven by long-term growth trends such as demographics, digitisation, and the transition to sustainable energy.”
Thomas Veith, global real estate leader at PwC, added, “Global real estate markets are sending positive signals, with operational real estate emerging as a key driver for value creation across nearly all investment categories. This trend calls for specialized expertise, new partnerships, and innovative investment structures. Our research suggests that the most significant opportunities lie at the intersection of real estate and infrastructure, with increased capital deployment expected in the coming year.”
Veith further explained, “An important shift is occurring as every component of the real estate investment process is being scrutinized for its potential to add value. Factors such as ESG considerations, access to operational data, and management of office spaces are being rethought. While this evolution will take time, it is expected to foster innovation and enhance the industry’s resilience for the future.”
As the real estate sector navigates these uncertain times, the report suggests that structural shifts driven by technological advancements and environmental goals will continue to influence investment decisions. The balance between cautious optimism and ongoing geopolitical risks will define the trajectory of global real estate markets in the years to come.
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