Understanding trends in the global property space

The global property market is experiencing a significant shift in investment trends as institutions and real estate investors move away from traditional portfolios of sovereign bonds and equities towards alternative assets like infrastructure, real estate, and private equity. James Wilkinson, the co-global chief investment officer for real estate securities at BlackRock, highlighted this trend in a recent interview with Chris Bishop, managing editor for Forbes Africa. Wilkinson emphasized that investors are now realizing that they can no longer rely solely on traditional investments to meet their future needs and are seeking a broader source of investment returns. As a result, infrastructure has become increasingly popular among institutional investors, despite the challenges it presents in terms of long-term commitments and regulatory complexities. Wilkinson pointed out that while investing in infrastructure may be more challenging to understand compared to real estate, successful investments can be made with the right approach and expertise. He acknowledged that there is a significant need for trillions of dollars in infrastructure investment globally and highlighted the importance of governments and private investors working together to address funding and organizational challenges. Wilkinson also discussed the evolving landscape of the property investment market, noting that funds investing in markets like Central Europe and Asia Pacific have adapted to the changing economic conditions and improved their risk management strategies since the global economic crisis of 2007-2008. He emphasized the importance of focusing on fundamentals and selecting assets and markets carefully to mitigate risks and maximize returns. Wilkinson highlighted the opportunities in listed property companies, particularly in sectors like global retail, where potential returns may be underestimated due to the impact of online retailing. He also addressed concerns about rising interest rates and regulatory uncertainty, emphasizing the significance of understanding market dynamics and policy responses. In conclusion, Wilkinson expressed cautious optimism about the global economy and property market, citing effective central bank policies and positive economic indicators. He underscored the impact of technology on the real estate sector, noting its influence on areas like online retail, logistics, co-working spaces, and lodging. Despite the challenges and uncertainties in the market, Wilkinson remained confident in the resilience and adaptability of the property investment business.