Adapting to the new baseline: Key takeaways from EXPO REAL 2026

At EXPO REAL 2026 in Munich, the European commercial real estate sector gathered to navigate one of the most structurally transformative periods in the industry's recent history.

EXPO REAL 2026. credit Messe München GmbH

Takeaways from the event suggest the market is shifting away from waiting for old conditions to return. Instead, the industry is embracing a new market baseline defined by structural realism, disciplined capital deployment, and a focus on long-term growth opportunities.

Cautious optimism and structural reset

While conference hall conversations remained upbeat, the operational reality on the ground reflects a sector oscillating between cautious pragmatism and selective recovery.

Industry leaders have moved past the "wait-and-see" approach of previous years, accepting that zero-interest-rate policies are gone.

Eurozone interest rate stabilisation is establishing a firmer floor for asset valuations, drawing opportunistic and value-add funds back out to acquire discounted stock.

Underwriting remains stringent. Transaction advisors and brokers highlighted deal structure clarity and disciplined execution over speculative bets.

Asset divergence

While listed real estate platforms have largely absorbed recent valuation shocks, asset performance is heavily fragmented.

Highly resilient asset classes—such as logistics, residential, data centres, senior living, and student housing—continue to command intense international capital interest. Prime CBD properties are holding firm.

Secondary, non-compliant, and traditional office assets face severe distress, pricing discounts, and liquidity penalties. This obsolescence is accelerating brown-to-green repositioning and conversion projects into residential units, hotels, or digital infrastructure.

Housing shortages & regulatory pressure

A central topic across keynotes and industry panels was the widening housing gap across major European cities.

Industry figures and public sector representatives stressed the urgent need to cut bureaucratic hurdles, streamline planning permits, and introduce targeted subsidies to stimulate residential development.

To counter rising construction costs, stakeholders are increasingly turning toward modular building methods and cost-effective digital construction techniques.

Logistics, infrastructure and alternatives

Discussions with major asset managers and developers focused on structural fundamental drivers over short-term macroeconomic noise.

Occupiers consistently prioritise proximity, power, and partnership—securing last-mile locations equipped with robust energy capacity. SEGRO noted that prime urban assets continue to support cautious speculative developments.

Driven by cloud demand and AI adoption, data centres, energy storage, and alternative infrastructure took centre stage as traditional business models adapt tightly to grid constraints.

Market outlook

The overarching message of EXPO REAL 2026 is that market participants must evaluate business models as they exist today. Scale, operational strength, and strict alignment with ESG and infrastructure demands are now essential.

The industry is moving past the "wait-and-see" approach that defined previous years. The advice echoed across halls was to evaluate viable business models as they exist today rather than anticipating a return to zero-interest-rate market conditions.

While secondary office assets remain a clear pressure point, underlying demand across last-mile logistics, infrastructure, and alternative sectors provides a stable foundation for the next market cycle.

Branislav Pekic