Real Estate 2020: Building the future

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As confidence returns to real estate, the industry faces a number of fundamental shifts that will shape its future

Global megatrends will change the real estate landscape considerably over the next six years and beyond. While many of the trends are already evident, there is a natural tendency to underestimate how much the real estate world will have changed by 2020.

The changing landscape will have major implications for real estate investment and development. It will increase the size of the asset pool, yet change the nature of investment opportunities. Real estate organizations will need to adapt early to survive and prosper.

Key findings

  • By 2020, investable real estate will have grown by more than 55% compared to 2012
  • By 2025, emerging markets will host 60% of global construction activity
  • By 2025, there will be 37 ‘megacities’, up from 23 today, and 12 of these will be in emerging markets

“Real Estate 2020 captures important trends in the industry and the impact they will have for real estate managers and the investment community. Key areas include the urbanization that’s taking place as people cluster around the great cities of the world, the new real estate subsectors that are emerging to satisfy the needs caused by shifting demographics, and also the technological implications that need to be considered as companies think and go globally. Every investor and asset manager can benefit from the profound implications shared herein.”

Byron Carlock, Partner and US Real Estate Leader

Six predictions for 2020 and beyond

  1. The global investable real estate universe will expand substantially, leading to a huge expansion in opportunity, especially in emerging economies.
  2. Fast-growing cities will present a wider range of risk and return opportunities.
  3. Technology innovation and sustainability will be key drivers for value.
  4. Collaborating with governments will become more important.
  5. Competition for prime assets will further intensify.
  6. A new and broader range of risks will emerge.

"While the size of the investable real estate universe will begin to diversify around the world, current major markets will still offer relevant investment opportunities. In 2012, the top 20 markets in the world represent 80.2% of the world’s total investable real estate universe. In 2020, these same markets will still represent 79.9% of the investable universe."

Andrew Warren, Assurance Director, Financial Instruments, Structured Products and Real Estate Practice


'Thinking global' is a big trend identified in the report, and it's important for US real estate companies and advisors that are doing business overseas to also understand how their risk profile now increases. In this new environment there's new laws and regulations with which asset managers need to be comfortable. The risks span political, tax and regulatory. An element for success will be having a trusted person on the ground that has local knowledge and experience.”

Robert Sciaudone, Assurance Partner, Real Estate Practice

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Byron Carlock, Jr.

Real Estate Leader, PwC US

Robert Sciaudone

Partner, PwC US

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