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

John Harcourt Kajima

John Harcourt

Managing director, Kajima

As 2021 ended the way it started, we need to accept the long-term impact of Covid, with recent trends set to continue into 2022.

Powered by online retail demand and a lack of supply, logistics will remain buoyant, but further yield compression will very much depend on inflation’s impact. Borrowers are no doubt checking hedging instruments. Inflation-resistant sectors such as PBSA and PRS are therefore going to remain popular, while physical retail’s challenges remain unresolved.

More forward-thinking investors are focusing their strategies around mixed-use, and if the government puts repurposing and regeneration at the heart of its levelling-up agenda, it could kill two birds with one stone.

That leaves the great unknown: offices. For every person delighted to be back, another is pleased to have increased flexibility at home. Quality, location and amenity provide a degree of resilience, but all new schemes must put ESG and wellbeing first if they are to be successful.

Geeta Nanda

Geeta Nanda

Chief executive, MTVH

This will be the year that we review the way our organisations are run as we come out of the pandemic. We need to ask ourselves how we can retain our organisational culture as we grapple with flexible working.

For social housing, building safety will rightly continue to be a major issue. Too many people find themselves fraught with anxiety over costs to their homes to meet fire safety standards. Significant steps will need to be taken to dispel their fears, ensuring that leaseholders can live in safety at no personal financial cost.

Sustainability will also play an increasing role as we build homes and maintain existing stock. COP26 placed climate change at the forefront of our consciousness. Social housing will need to play its part in meeting green targets.

Rob Bower

Managing partner, Montagu Evans

I hope 2022 is a year of stability; our clients need that to be confident to invest and make decisions. Planning and transport needs to evolve to support new ways of living and working. Lots of buildings need to change and our policy and political framework needs to support and encourage that investment.

Bolder decisions on governance, diversity and sustainability are needed, not just in our own businesses, but how we operate as an industry, with huge national influence and a potential to make a major difference.

London will be a powerhouse – not just as a driver of the global economy, but in its ability to lead as the country levels up. Whatever happens, working in partnership has never been more important. No one can do this alone and collaboration is key.

Andrew Coombs re-sized

Andrew Coombs

Chief executive, Sirius Real Estate

Global trade will have an impact on real estate as never before in 2022. Re-shoring and China’s refocusing on its own economy at the expense of global expansion will affect business across the UK and continental Europe. From small and medium-sized enterprises at our new UK arm BizSpace to our industrial, self-storage and office occupiers across our German business parks, we are seeing rapid growth as business is repatriated to home territories.

At the same time, Covid-19 has triggered the rapid growth of start-ups working ‘near to home’ and has driven growth sectors such as dark kitchens and last-mile logistics. People are no longer trekking into work, but are enjoying ordering meals at home.

For property, the impact is profound – it is a grassroots revolution spurring the success of not only industrial and business space, but regions that need levelling up.

 

Continue to part 35 here

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Predictions for 2022: Brace yourself…