Geopolitics, Donald Trump and the conflict in Ukraine dominated discussions among some of the world鈥檚 largest pension, insurance and sovereign wealth funds at the annual RE-Invest Summit in Cannes this week.
Investors from across Europe, North America, Asia-Pacific and the Middle East convened once again to discuss the most pressing issues as part of the annual MIPIM real estate trade fair in the south of France.
But conversations frequently turned to talk about the unpredictable impact of geopolitical uncertainty and armed conflict on European economies and the region鈥檚 real estate markets. The topic arose consistently during the roundtable discussions, including the first which was entitled 鈥淲hat is keeping you awake at night?鈥�.
This week鈥檚 discussions therefore contrast with last year, when investor minds were most exercised about the trajectory of interest rates and the implications and timing for a recovery in real estate transactions.
The shift in focus had been predicted in the most recent edition of 91传媒在线. Last month, Robert-Jan Foortse, head of European real estate at APG, the asset manager for the largest pension fund in the Netherlands, told 91传媒在线: 鈥淚 think lots of the discussions at MIPIM will be around geopolitics鈥� this will be top of mind for everybody.鈥�
During the summit this week, investors acknowledged how it was difficult to invest with conviction among such uncertainty, although some suggested that greater defence spending in Europe 鈥� most notably in Germany 鈥� could provide a boost to economies and real estate markets in the region.
Data centres, DeepSeek, debt markets
The second most prevalent topic at RE-Invest was the booming market for data centres, which have been a growing investment target of both real estate and infrastructure investors and fund managers.
Discussions turned to the possible risks that new advances in artificial intelligence 鈥� as highlighted by the emergence of China鈥檚 DeepSeek in January 鈥� could have on the sector, potentially reducing demand, especially for large hyperscale facilities.
During conversations about the outlook for data centres, talk once again quickly turned to the 鈥渂lurring of lines鈥� between real estate and infrastructure, which was a major topic at last year鈥檚 MIPIM.
However, while some characterised this as competition between the two asset classes, others pointed to opportunities for real estate and infrastructure teams and businesses to collaborate in areas such as data centres and energy transition.
There was also recognition that real estate needed to reassess its role in institutional portfolios and to ensure it 鈥渟tays relevant鈥� in a fast-moving world.
The asset class is becoming more complex and operational in nature, which introduces new risks but also potentially creates opportunities for it to differentiate itself and add value to portfolios and economies.
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