After two years of unprecedented challenges faced by real estate, experts share their predictions for 2022.

Oscar Brooks

Oscar Brooks

Director, Moda Living

After a year of continued growth in the build-to-rent (BTR) market in 2021, it’s great to see operators launching new homes across the country. We think 2022 will be a landmark year in the way that consumers interact with and truly begin to experience the proposition of quality managed rental homes at scale.

At Moda Living, lettings at Angel Gardens, The Lexington and The McEwan have all surpassed their targets, as more and more people prioritise lifestyle, amenity and service over traditional PRS and consider it alongside home ownership. While still an emerging sector, we anticipate this trend will continue with force in 2022 and beyond.

ESG will rightly become even more of a focal point, with time ticking to make a change in the wake of COP26. This year, we’re partnering with new carbon-focused event Footprint+, which is bringing the sector together to come up with immediate, actionable ways to reduce carbon output, and look forward to coming together with colleagues from across the sector to exchange ideas on this.

Arsenievich, Kristina_portrait

Kristina Arsenievich

Director, European real estate ESG, Barings

Last year, we saw ESG become mainstream and rise to the top of the agenda for many corporates, proudly announcing commitments to achieving net zero carbon emissions. We have seen governments devise ambitious targets, which will require a monumental shift in how the global economy operates.

Perhaps most importantly, we have learned that the health and wellbeing of people and the planet is a fundamental human right that determines performance of the free markets. The built environment plays a key role in enabling the transition to a low-carbon economy and at Barings Real Estate we are extending our ambitions beyond the boundaries of corporate emissions, evolving our ESG targets into tangible transition plans and supporting multilateral partnerships that bring about positive change.

We invite our stakeholders, development partners and occupiers to actively engage on climate resilience and wellbeing integration, increasing biodiversity net gain and social value through meaningful stewardship.

Steven Boyd

Steven Boyd

Chief executive, Government Property Agency

This will be a pivotal year for the workplace. For the Government Property Agency, our work continues in supporting the delivery of government priorities including supporting levelling up, sustainability and civil service reform through property technology and hybrid working, issues that have important parallels for the industry at large.

In the workplace, despite a lot of the change in working habits starting pre-pandemic, my colleagues Dominic Brankin, workplace services director, and Kate Guthrie, deputy director workplace experience, believe this evolution will continue for some time. They see 2022 as the year in which businesses show real commitment to learning and curiosity about their people’s workplace experience.

It’s expected that companies will make good progress in getting the right workplace design to support the combination of people’s different working practices. People have had experience of working at home for a long period of time now, and there will be some who want to continue this practice, but also a lot of people who will relish a choice of working environments to suit different tasks. The organisations that will be most successful will be the ones where great workplaces meet great leadership – where honest conversations about the workplace are proactively facilitated and feed into choices made by teams to enable them to work as effectively as possible.

Cristina García-Peri

Cristina Garcia-Peri

Head of corporate development and strategy, Azora

We believe that investment in offices will be back with a vengeance next year – with the pandemic having highlighted the unequivocal benefits of in-person collaboration – and we also believe that as sentiment and pricing shift, we will start to see capital going back into retail.

We anticipate that value-creation levers will be more widely adopted as the preferred ways to generate additional returns: specifically through taking on more development and operating risk in the form of variable rents and management contracts across new real estate asset classes.

The biggest question marks for 2022 centre around the evolution of inflation, the time taken for lives to normalise post pandemic and the ‘when and how fast’ quantitative easing stops and interest rates rise.

We will continue to focus on the sectors where we have the highest convictions on rising demand and rental growth and believe that there will be a significant amount of attractive investment opportunities for those investors with proven development capabilities and who are prepared to take on some operating risk.

Continue to part seven here

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Predictions for 2022: Brace yourself…