(Jan 31): Will building skyports for flying cars become the latest “must have” feature for luxury residential buildings? Will there be human settlements on Mars?
Despite decades-old predictions, it does not appear they will revolutionise real estate anytime soon. However, certain trends such as climate risk and improved data availability have impacted real estate in the near term. As a result, 2020 may be a watershed year for the way investors think of real estate as an asset class.
To be sure, real estate has evolved from a relatively small, insignificant and difficult-to-understand element of multi-asset-class portfolios that traditionally have been dominated by equities and fixed income. Over time, real estate has become a larger part of institutional portfolios. Combined with the shift to index-based equity portfolios, real estate’s relative contribution to total active risk and running costs has come under increased scrutiny.
