Institutional real asset investors are entering 2026 with cautious optimism, supported by forecasts of improving market conditions and a modest macroeconomic recovery. After a year marked by repricing, geopolitical risk and regulatory uncertainty, the emphasis is shifting towards income resilience and disciplined allocation.
Savills’ recent forecast shows that global real estate investment volumes could exceed $1trn (€850m) in 2026, driven by renewed institutional demand for core, income-producing assets. The advisory firm points to stabilising valuations and improving confidence in sectors such as logistics, residential and essential infrastructure, where cashflows are more predictable and supply constraints remain supportive.
The macro backdrop may also become more constructive. In its Outlook 2026, Allianz Global Investors anticipates a gradual European recovery, with GDP growth of around 1–1.5% and scope for monetary easing as inflation pressures moderate. While risks remain elevated, the outlook suggests conditions may be more favourable for real assets offering inflation linkage and long-term income stability.
These expectations contrast with the more defensive stance that dominated much of 2025. As IPE Real Assets observed in its November/December commentary, the past year became ‘a time for pragmatism’. Geopolitical instability, housing affordability and deglobalisation moved sharply up investor risk registers, reshaping allocation decisions across real estate and infrastructure. Deglobalisation, in particular, has risen significantly as a concern since 2023, influencing views on logistics, energy security and domestic supply chains.
ESG considerations remained embedded in real asset strategies during 2025, but with less visibility than in the immediate post-pandemic period. As previously reported, ESG priorities broadly returned to pre-2021 levels, reflecting a shift away from broad commitments towards implementation, reporting and risk management. In Europe, ESG continues to be treated as a core investment consideration rather than an optional overlay
A notable development during the year has been the expansion of ESG risk analysis beyond climate change alone, with growing investor focus on biodiversity loss, deforestation exposure and natural capital dependencies. These issues are increasingly regarded as financially material for long-term performance, particularly in real estate, forestry and infrastructure portfolios
Regulation will be a key influence in 2026. In November 2025, the European Commission confirmed plans to overhaul the Sustainable Finance Disclosure Regulation. The proposed removal of Article 8 and Article 9 labels in favour of clearer sustainability categories is intended to simplify disclosures while improving credibility. For real asset managers, the changes will place greater emphasis on how ESG considerations are applied in practice, rather than on product classification alone.
Overall, while uncertainty remains high, forecasts from Savills and Allianz suggest the environment for real assets in 2026 may be more stable than in recent years. As IPE Real Assets coverage throughout 2025 has shown, investors are moving beyond ESG ambition towards execution, focusing on assets that can deliver resilient income and protect value amid regulatory change and geopolitical risk.
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