China’s New Property Cycle Is Being Built on Domestic Capital

China’s commercial real estate investment market is beginning to regain momentum, but the capital behind the improvement looks markedly different from that of previous property cycles. Rather than relying on a broad return of overseas funds, transaction activity in 2026 is increasingly being supported by Chinese companies acquiring premises for their own use, insurance groups, domestic institutions and private investors prepared to take long-term positions in assets whose values have already undergone substantial correction.

Shanghai provides one of the clearest examples of this shift. Commercial property transactions strengthened during the second quarter of 2026, while companies purchasing buildings for their own occupation emerged as one of the market’s most important sources of demand. Owner-occupiers accounted for approximately 45% of Shanghai investment activity during the quarter. Across the first half of the year, their share was around 43%, compared with approximately 18% for 2025 as a whole.

This represents more than a temporary change in transaction statistics. It suggests that the investment market is developing a new domestic buyer base capable of providing liquidity at a time when many traditional international property investors remain highly selective about China.

Companies have become particularly important purchasers of office buildings. After several years of falling valuations, acquiring an existing building can now make financial sense for businesses that previously would have leased their headquarters. A corporate buyer does not necessarily evaluate a property in the same way as an investment fund. Long-term occupation, control over premises, corporate identity and the ability to replace future rental expenditure with ownership can all influence the decision.

This difference in motivation is helping transactions take place even while conventional investment fundamentals remain challenging. Shanghai continues to face substantial office availability and pressure on rents, but these conditions do not automatically prevent a company from purchasing a building if the acquisition price has fallen sufficiently.

The changing market can already be seen in major transactions. Corporate and financial-sector buyers have acquired prominent Shanghai office properties for headquarters or strategic occupation. Such deals demonstrate how the correction in commercial property values is opening buildings that might previously have been priced primarily for institutional investment to a much broader range of domestic purchasers.

Domestic capital now dominates Shanghai investment activity more generally. During the first half of 2026, corporate purchasers represented more than half of transaction demand, while institutional and insurance investors provided another substantial share. Overseas capital remains present, but it is no longer necessary for international funds to lead the market for significant transactions to occur.

Beijing is experiencing a similar transformation. Domestic buyers accounted for virtually all recorded investment activity during the first half of the year, while corporate purchasers represented a particularly large proportion of acquisitions. Taken together, developments in China’s two largest commercial property markets suggest that this is becoming a structural change rather than an isolated Shanghai phenomenon.

Insurance capital is emerging as another important part of the new ownership landscape. Chinese insurers manage large pools of long-term capital and require assets capable of generating income over extended periods. With domestic fixed-income returns relatively low and commercial property prices substantially below earlier peaks, selected offices, retail properties and other mature assets have become increasingly attractive.

Several significant transactions have already demonstrated the scale at which insurance capital can participate. Insurers have taken positions in major commercial properties, including large Beijing assets, while billions of dollars have been deployed into Chinese real estate over recent years.

For property owners seeking to sell, this creates a valuable alternative source of liquidity. Developers dealing with balance-sheet pressure, overseas funds approaching the end of investment periods and existing owners seeking to release capital can potentially sell to institutions that are under less pressure to achieve short-term capital appreciation.

The investment logic nevertheless remains highly selective. Chinese insurers and other domestic institutions are not simply purchasing commercial buildings because prices have fallen. Location, tenant quality, income security, building specifications and the ability to maintain occupancy remain critical. Older properties in weaker locations can therefore continue to struggle even while transactions return elsewhere in the market.

This creates an increasingly pronounced division between buildings capable of attracting long-term domestic capital and properties that remain difficult to finance or sell.

The role of international investors also requires careful interpretation. Foreign capital has not abandoned China, and selected investors continue to examine opportunities. However, overseas funds no longer occupy the position they once held in determining market liquidity.

In some transactions, international investors are now sellers rather than buyers. Assets accumulated during China’s earlier expansionary period are being brought to market after substantial valuation adjustments, creating opportunities for domestic companies and institutions to acquire established properties at prices that would have been difficult to achieve several years ago.

The result is effectively a transfer between investment cycles. Buildings assembled when foreign institutional capital was expanding aggressively in China are gradually moving toward a more domestically controlled ownership structure.

That transition is occurring against a property market that remains far from fully recovered.

Office vacancies remain high in several major Chinese cities and landlords continue to face rental pressure. Development investment has also contracted sharply. During the first six months of 2026, national real estate development investment remained significantly below the previous year, with spending on offices and commercial buildings recording particularly steep declines.

The contrast is important. Investors are showing greater willingness to acquire completed properties at corrected valuations while remaining cautious about committing capital to new development.

China therefore appears to be experiencing an investment-market recovery before experiencing a development-market recovery.

The distinction also explains why transaction volumes can increase despite weak rental indicators. Property prices have adjusted much faster than many occupational markets have recovered. For purchasers with substantial cash resources and long investment horizons, that repricing can create opportunities before rents or occupancy begin improving materially.

Another important development could further accelerate the transformation. China expanded the role of publicly traded real estate investment vehicles during 2026, including the introduction of commercial property REITs backed by established office and retail assets.

A deeper domestic REIT market could eventually provide owners with another mechanism for releasing capital from mature properties. It could also create an institutional exit route for investors acquiring and repositioning buildings today, increasing the potential liquidity of commercial assets.

Retail property could particularly benefit where shopping centres have stable occupancy, established operating histories and predictable cash flows. Rather than requiring an overseas fund to acquire an entire property, mature assets could increasingly move between domestic private owners, insurers, institutions and listed investment structures.

State-related and government-linked capital may also participate in this changing landscape, particularly where acquisitions have strategic, financial or urban-development objectives. However, the strongest evidence from the first half of 2026 points toward a broader domesticisation of investment rather than a market being rescued primarily by state-owned buyers.

This matters because China may be constructing a commercial property investment system that functions differently from the one that existed before the downturn.

During the previous expansion, developers, international funds and rapidly appreciating property values played central roles. The emerging market is more dependent on existing assets, corrected prices, operating income and purchasers willing to hold property for strategic or long-term financial reasons.

Shanghai has become the clearest testing ground. Rising transaction activity is taking place even without a dramatic recovery in office rents or the wholesale return of overseas capital. Companies are buying headquarters, insurers are examining long-duration assets and domestic institutions are purchasing properties at valuations that increasingly compensate for leasing and economic risks.

The significance of China’s commercial property recovery may therefore lie less in how much real estate is being traded than in who is purchasing it.

If this pattern continues, the next Chinese property cycle will not simply restore the market that existed before the downturn. It could leave the country’s most important commercial buildings in substantially different hands, with domestic corporate and institutional capital becoming the foundation of investment liquidity rather than an alternative to foreign money.

Source: CIJ.World Research & Analysis Team

London’s Stranded Office Challenge: When Refurbishment, Conversion and Redevelopment No Longer Add Up

London’s office market is developing an unusual imbalance. Companies are still leasing substantial amounts of workspace, particularly in the City and West End, while parts of the older office stock are becoming increasingly difficult to position. The problem is therefore less about whether London still needs offices and more about what happens to buildings that occupiers no longer consider competitive.

Evidence from the second quarter of 2026 reinforces this divide. Central London leasing remained relatively resilient, with approximately 2.5–2.8 million sq ft of space taken during the quarter according to major property advisers. The overwhelming preference, however, was for modern, high-quality accommodation. Around three quarters of leasing activity involved Grade A space, while prime rents continued to strengthen in the most sought-after locations.

This creates a growing challenge for owners of ageing buildings. An office that struggles to attract tenants might appear to have an obvious second life as apartments, a hotel or specialist accommodation. In practice, changing the use of an existing commercial building can prove considerably more complicated and expensive than its acquisition price initially suggests.

Residential conversion demonstrates the problem particularly clearly. London has an acute requirement for additional housing, making underused offices appear to offer a potentially valuable source of new homes. Yet many commercial buildings were designed around requirements fundamentally different from residential development. Large floorplates can place substantial areas too far from external windows, while structural columns and fixed cores can restrict apartment layouts. Existing staircases, lifts and service shafts may work efficiently for offices but poorly for housing. Once daylight, ventilation, fire safety, circulation and residential amenity requirements are incorporated, the amount of commercially usable space can decline substantially.

Planning adds another layer of uncertainty. In parts of central London, investors cannot assume that an office building can simply be removed from commercial use because demand has weakened. The City of London continues to protect strategically important office capacity, and recently adopted guidance can require evidence that continued commercial occupation is no longer realistically achievable. This can include demonstrating that a property has been genuinely marketed and examining whether refurbishment could restore its competitiveness. Consequently, acquiring an underperforming building at a discount does not automatically provide an inexpensive route into residential development.

Environmental policy makes the calculation still more complicated. London authorities increasingly encourage developers to examine whether existing structures can be retained rather than demolished. Westminster strengthened this direction during 2026, while the City has also placed greater emphasis on assessing the carbon consequences of refurbishment and redevelopment alternatives. The reasoning is understandable: demolishing a substantial concrete and steel structure and replacing it consumes large quantities of materials and produces significant emissions before the replacement building has even opened.

For property owners, however, this creates a difficult investment equation. A building can be insufficiently attractive to modern office tenants, physically unsuitable for straightforward conversion and environmentally difficult to justify demolishing.

Hotels offer another potential escape route, particularly in locations benefiting from London’s tourism and business-travel economy. Several older commercial properties have successfully moved towards hospitality use, but suitability depends heavily on the existing building. Hotel bedrooms require appropriate dimensions and access to natural light, while bathrooms dramatically increase plumbing requirements. Developers also need sufficient space for lifts, fire escape, housekeeping, kitchens, storage, servicing, plant and other operational functions. Buildings that initially appear inexpensive can become considerably less attractive once these requirements are incorporated into the design.

Life sciences provide an even clearer warning against assuming that alternative demand can rescue obsolete offices. During the earlier expansion of London’s life-science sector, converting conventional offices into laboratories appeared to offer landlords an attractive repositioning strategy. The technical requirements of laboratory buildings, however, are substantially greater than those of ordinary workplaces. Ventilation, extraction, power supply, vibration control, floor loading and specialist mechanical equipment can require extensive structural and engineering intervention.

Market conditions have also changed. By mid-2026, roughly 800,000 sq ft of planned laboratory development in Central London had reportedly been redirected towards conventional offices or more flexible buildings capable of accommodating a broader range of occupiers. This suggests that specialist conversion cannot simply be treated as a guaranteed solution for unwanted commercial stock.

The increasingly important alternative may therefore be not conversion at all, but refurbishment. Some London buildings approaching functional obsolescence have instead been extensively modernised while retaining substantial portions of their original structures. Projects such as 10 Gresham Street demonstrate how an existing office can be repositioned towards current occupier expectations without automatically resorting to demolition or changing its use entirely.

This strategy potentially addresses several problems simultaneously. Retaining the structural frame can reduce the environmental impact associated with rebuilding, while new mechanical systems, amenities, interiors and flexible working areas can improve the property’s competitive position. Yet refurbishment also has limits. Some buildings have ceiling heights, cores, façades, structural grids or mechanical systems that make achieving contemporary office standards disproportionately expensive. Owners can therefore reach a point where none of the available strategies produces an attractive return.

Financing magnifies the difficulty. Central London investment activity remained subdued compared with longer-term averages during the first half of 2026 despite relatively healthy leasing conditions. Lenders and investors are increasingly required to distinguish between properties that need conventional capital expenditure and those facing deeper structural obsolescence.

Buying a secondary office for conversion means financing much more than the acquisition. Investors must account for planning risk, construction costs, professional fees, financing expenses, potential periods without income and uncertainty surrounding the eventual value of the completed property. A substantial discount to the price of a prime office can therefore be deceptive. What appears to be inexpensive real estate may actually represent the market pricing in substantial future capital requirements.

Energy efficiency introduces another valuation consideration. Expectations surrounding tighter standards for rented commercial buildings are influencing investment decisions even as the regulatory framework continues to evolve. The government indicated in June that it intends to move larger rented non-domestic buildings towards higher energy-performance requirements, although implementation details remain subject to further legislation. Owners consequently have to consider not only whether today’s tenants will occupy a building, but whether the property will remain economically competitive under tomorrow’s environmental and operational standards.

This is producing a widening divide within London commercial real estate. At one end are modern and comprehensively refurbished offices capable of commanding high rents from companies prepared to pay for quality, efficiency, amenities and location. At the other are ageing buildings requiring substantial investment merely to remain competitive. Between them sits a potentially problematic category: offices that are no longer attractive enough to compete successfully but are not sufficiently adaptable to make another use financially compelling.

For investors, this middle category could become one of London’s most significant property challenges over the remainder of the decade. The opportunity will increasingly depend on identifying buildings where the existing structure has genuine optionality. Properties with manageable floor depths, adaptable cores, suitable ceiling heights, strong transport connections and layouts capable of supporting several potential uses could attract increasing attention.

Conversely, buildings combining poor environmental performance, inefficient floorplates, major capital requirements and limited conversion possibilities may need increasingly substantial acquisition discounts before redevelopment becomes viable.

London therefore does not simply face an office obsolescence problem. It faces a question about the residual value of buildings caught between competing strategies. Some will be refurbished and return to the premium office market. Others will become hotels, homes or mixed-use developments. A smaller number may support specialist uses, while buildings where retention cannot produce an economically viable solution will ultimately be replaced.

The difficult assets are those for which none of these routes works comfortably. As the gap between London’s best and weakest offices widens, investors may discover that the most important calculation is no longer how cheaply an obsolete building can be acquired. It is how much of the building can realistically be retained, what it can economically become and whether the value of its next use is sufficient to pay for the transformation.

Source: © CIJ.World UK Research & Analysis Team

Germany’s Debt Reset Is Starting to Put Property Back on the Market

Germany’s commercial property downturn is entering a new phase. After several years in which lenders and borrowers largely managed falling valuations through extensions, restructuring and additional equity, the approaching maturity of loans arranged during the era of exceptionally cheap debt is making those compromises harder to maintain. The result is unlikely to be a sudden nationwide wave of foreclosures. Instead, 2026 and 2027 are shaping up as the period when refinancing increasingly determines who can continue owning property and who eventually has to sell.

This distinction is becoming particularly important for offices, shopping centres, development projects and highly leveraged portfolios. Properties that were financed when interest rates were close to historic lows are now being assessed against very different borrowing costs, valuations and lender requirements. In many cases, refinancing the original debt amount is no longer possible without owners contributing additional capital.

The deterioration is already visible in bank balance sheets. Research published during the second quarter of 2026 indicates that the stock of problematic German commercial property loans has risen more than fourfold since the end of 2023. At the same time, a substantial volume of European real estate debt is reaching maturity during 2026, putting refinancing decisions that could previously be postponed firmly back on the agenda.

German lenders have also become considerably more selective. Credit conditions for property borrowers tightened during the second quarter, with banks paying greater attention to valuations, debt-service capacity, asset quality and the amount of equity sitting beneath their loans. Financing remains available, but increasingly on terms that favour stronger properties and better-capitalised owners. That is creating a market divided less by property sector than by the financial strength of the borrower.

An owner with a modern, well-let building and access to fresh equity may be able to refinance without significant difficulty. Another owner holding a similar-sized property but carrying higher leverage, weaker occupancy or substantial refurbishment requirements could face a sizeable funding gap when the existing loan expires.

Consider a property previously valued at €100 million with €65 million of debt. If its current value falls to €75 million and a new lender is willing to provide only 60% financing, the replacement loan would be around €45 million. The owner would then need approximately €20 million from another source simply to repay the previous lender. For investors searching for distressed opportunities, that equity shortfall is becoming one of the most important forces in the German property market.

Offices are particularly exposed because refinancing pressure is arriving alongside profound changes in occupier demand. Prime buildings in central locations remain capable of attracting tenants and finance, particularly where they meet modern environmental and workplace requirements. Older properties in weaker locations face a much more difficult calculation.

An ageing office may require substantial investment just as its existing financing expires. Lower valuations can reduce the amount banks are prepared to lend, while vacancy, refurbishment costs and uncertain future rents make lenders still more cautious. Owners must then decide whether injecting further capital into the building is economically justified. This could create an expanding pool of secondary offices where the problem is not insolvency in the conventional sense but an unwillingness or inability to finance the next stage of the property’s life.

Germany’s development market faces an even more severe version of this challenge. Projects initiated under assumptions formed during the previous cycle have subsequently encountered higher construction costs, more expensive financing and a weaker investment market. Sites or partially completed schemes without sufficient pre-leasing or committed buyers can be especially difficult to refinance.

For some developers, raising additional equity will remain possible. Others may need new partners, replacement lenders or buyers prepared to take over projects. This means opportunities for investors could increasingly include development land, unfinished buildings and recapitalisations rather than only completed investment properties.

Retail presents a more varied picture. Germany’s strongest retail parks, grocery-led properties and dominant shopping destinations continue to attract investment demand. The financing challenge is concentrated further down the quality spectrum, where weaker centres may require refurbishment, changes in tenant mix or partial redevelopment.

In these cases, banks increasingly have to assess what the property can realistically generate in the future rather than relying on valuations established during the previous investment cycle. Tenant failures or store closures can further weaken the business case, particularly when replacing occupiers requires additional capital or rent incentives.

The potentially larger source of investment opportunities, however, may be leveraged portfolios. Owners that assembled substantial portfolios when borrowing was inexpensive do not necessarily need their properties to perform badly to experience refinancing difficulties. A decline in valuation combined with lower acceptable leverage can be enough to create a large funding requirement across multiple assets.

Those owners have several possible responses. They can contribute new equity, bring in an investment partner, obtain more expensive junior capital or sell part of the portfolio. If none of those alternatives is attractive or available, a larger disposal may eventually become necessary. This means that some of Germany’s future distressed property transactions may never appear publicly as distress.

A portfolio owner selling several buildings to reduce debt ahead of a refinancing deadline may describe the transaction as portfolio management. Economically, however, the sale can still be driven by the need to repair the balance sheet. That helps explain why the long-awaited flood of distressed German property has taken so long to materialise.

Banks generally have little incentive to seize buildings when investment liquidity is poor and valuations are uncertain. Extending a loan, renegotiating terms or allowing an owner additional time to sell assets can produce a better outcome than immediate enforcement. Borrowers have similarly preferred to inject capital, dispose of selected properties or renegotiate financing rather than surrender entire portfolios.

Those measures bought time during the sharpest part of the property correction. They did not eliminate the underlying refinancing problem. The difference in 2026 is that transaction markets are becoming functional again. German property investment increased during the first half of the year compared with the same period of 2025, demonstrating that capital is returning selectively even though financing remains restrictive.

Improving liquidity could paradoxically accelerate distressed and refinancing-driven sales. When there are credible buyers, lenders have more alternatives to repeatedly extending problematic loans. Owners can also establish clearer market values for properties and determine whether retaining them still makes financial sense.

This creates an attractive environment for investors with substantial equity and limited dependence on traditional senior debt. They can target assets where the underlying property remains viable but the existing financing structure no longer works. The opportunity is therefore different from the widespread liquidation environment that followed previous financial crises.

Germany is more likely to experience a prolonged transfer of selected assets from highly leveraged owners to investors capable of supporting lower leverage and providing capital for refurbishment, repositioning or development completion. Secondary offices requiring investment appear particularly exposed, alongside unfinished developments, weaker shopping centres and portfolios purchased or refinanced at aggressive valuations during the previous cycle. High-quality properties with secure income should remain considerably easier to finance.

The crucial question for Germany’s property market is consequently shifting. For much of the downturn, investors asked when banks would finally force borrowers to sell. During 2026 and 2027, the more useful question may be how much additional equity owners are prepared, or able, to contribute when their loans mature.

Those that can bridge the difference between yesterday’s debt and today’s financing conditions may retain their properties and wait for a stronger market. Those that cannot are likely to become an increasingly important source of investment product.

Germany’s next distressed cycle may therefore arrive without dramatic foreclosure signs or widespread fire sales. It could instead emerge gradually through recapitalisations, development takeovers, portfolio reductions and negotiated disposals. For investors who have spent several years waiting for the repricing of German commercial real estate to produce opportunities, that process may now finally be moving from theory into transactions.

Source: CIJ.World Research & Analysis Team

India’s Rental Housing Sector Is Taking Its First Steps Towards Institutional Investment

India’s rental housing market is beginning to undergo a structural change as rising home prices, workforce mobility and changing attitudes towards ownership create opportunities for professionally operated residential accommodation.

The development should not yet be considered a conventional build-to-rent boom. India remains some distance from markets such as the United States, United Kingdom and Japan, where institutional investors own large portfolios of apartment buildings developed specifically to generate long-term rental income. Instead, India’s transition is emerging through specialist residential sectors including co-living, student accommodation, senior housing and accommodation serving major employment and industrial locations. These segments could ultimately provide the foundation for a much larger institutional rental market.

Demographics are creating favourable conditions for this change. Continued urbanisation brings workers and students into India’s major cities every year, while younger professionals increasingly move between employment centres as their careers develop. For someone expecting to remain in Bengaluru, Hyderabad, Pune, Chennai, Mumbai or Delhi-NCR for only several years, purchasing a property may not always make financial or practical sense. Renting provides greater flexibility while avoiding the substantial deposit and mortgage commitments associated with ownership.

Housing affordability is strengthening this argument. Residential values have increased considerably across India’s leading cities, while developers have increasingly concentrated new supply towards higher-priced properties. This has made purchasing a home more difficult for younger and middle-income households even where employment and salaries continue to expand. The result is a growing population that can afford good-quality accommodation but may not be willing or able to purchase a home in the city where they currently work.

Rental costs are rising as a consequence. Bengaluru has recorded continued residential rental growth during 2026, while increases have also been visible across parts of Mumbai and Delhi-NCR. Improving rents strengthen the investment case for residential property, but they do not automatically make conventional build-to-rent development financially attractive.

The fundamental obstacle remains the relationship between land prices and rental returns. Urban development land in India’s largest employment centres is expensive. A developer purchasing such land can generally recover capital much faster by constructing apartments and selling them individually than by retaining an entire project and collecting rent over several decades.

Residential rental yields also remain relatively modest compared with returns available from several commercial property sectors. Once financing, maintenance, property management and operating costs are included, developing conventional apartment blocks exclusively for rental income can become difficult to justify. This helps explain why India’s institutional rental sector is developing differently from its Western counterparts.

Co-living has become one of the most visible examples. Operators provide furnished rooms or compact accommodation together with shared facilities, maintenance, security and flexible rental agreements. The model is particularly suited to young professionals moving to expensive employment centres who want accommodation without purchasing furniture, arranging utilities or committing to long leases.

Rather than buying buildings, many operators are expanding through long-term leases, management agreements and revenue-sharing arrangements with property owners. These structures allow businesses to increase the number of beds under management without requiring enormous amounts of capital for property acquisition.

Student housing could offer an even larger opportunity. India has one of the world’s biggest higher-education populations, yet professionally operated student accommodation represents only a fraction of the housing available to students. Many students living away from their families rely on university hostels, paying-guest accommodation and privately rented apartments. The quality, security and management of these properties can vary significantly.

Purpose-designed student residences can provide investors with concentrated demand while offering residents professionally managed buildings, predictable costs, security and communal facilities. Large education centres therefore represent natural locations for institutional residential investment, particularly where universities cannot provide sufficient accommodation themselves.

Senior housing is developing as another specialist residential category. India’s ageing population, changing family structures and rising household wealth are gradually increasing demand for communities combining residential accommodation with security, healthcare access and social facilities.

Industrial expansion could create a further rental market. India’s manufacturing investment is creating employment clusters around industrial corridors and emerging economic centres. Professionally managed accommodation near these locations could become increasingly important for companies employing workers who have relocated from other regions.

These different markets demonstrate why India’s institutional rental sector is unlikely to develop around a single residential product. Young professionals, university students, families relocating between cities, industrial workers and older households have very different requirements. Investors capable of designing accommodation around these groups may have a stronger opportunity than those attempting to reproduce a standard apartment rental model across the country.

Regulation remains another important consideration. India introduced the Model Tenancy Act in 2021 as a framework that states and Union Territories could use when modernising their rental legislation. Its objective was to create clearer relationships between property owners and tenants and improve mechanisms for resolving disputes. It did not establish one national tenancy regime.

Rental and land regulation remain substantially under state jurisdiction, meaning implementation varies across India. Some states have adopted or amended tenancy legislation while others continue operating under different legal structures. This creates additional complexity for institutional landlords seeking to build portfolios across several cities.

Greater consistency in rental regulation, contract enforcement and dispute resolution could improve investor confidence and make large professionally managed portfolios easier to operate. Land costs may require more innovative solutions as well.

Rather than purchasing prime urban sites at full market prices, future rental developments could use long-term land leases, partnerships with public authorities, redevelopment of underused properties or agreements with existing landowners. Conversion of existing buildings may provide another route. Apartment projects, hotels and other properties could potentially be repositioned into managed rental accommodation where location and building configuration make conversion economically viable.

Institutional investors are already becoming more willing to consider property sectors outside traditional offices, logistics and retail. India attracted approximately USD 4.4–4.5 billion of institutional property investment during the first half of 2026, depending on the methodology used to measure transactions. Domestic investors represented more than half of this capital.

Living sectors still account for only a relatively small proportion of the institutional market, but the expansion of alternative property investment demonstrates that investors are increasingly willing to consider specialised assets capable of producing recurring income. Rental housing could eventually become part of this diversification.

The opportunity is considerable because India’s professionally managed rental stock remains small compared with the potential population requiring accommodation. The challenge is converting that demand into investment structures capable of generating acceptable long-term returns.

India’s route towards institutional rental housing is therefore unlikely to begin with thousands of conventional apartments owned by pension funds and international property investors. It is more likely to develop gradually through co-living buildings, student residences, senior communities and workforce accommodation, creating professional operators and investment platforms that can eventually be consolidated into larger portfolios.

Once these businesses demonstrate stable occupancy, predictable operating costs and reliable rental income, institutional capital is likely to become more comfortable with the sector.

India is therefore not experiencing a build-to-rent boom yet. What is emerging is potentially more important: the early formation of an institutional residential rental industry. If rising housing costs, urban migration and changing consumer preferences continue to strengthen rental demand, today’s specialist living platforms could become the foundation of a much larger investment market over the coming decade.

Source: © CIJ.World India Research & Analysis Team

Digital Twins Move into Everyday Management of Polish Shopping Centres

Digital twin technology is becoming part of day-to-day shopping centre management in Poland, with Nhood using its digital property platform across 14 Ceetrus-owned assets covering approximately 200,000 sqm.

The technology brings together information that would traditionally be distributed across building plans, technical records, photographs, leasing databases and other management systems. Nhood’s implementation combines three-dimensional building models with tenant information, technical equipment records and 360-degree imagery, giving property teams a common digital view of individual assets.

For shopping centre owners, one of the potential advantages is the ability to connect physical information about a property with operational and commercial data. Instead of examining a building’s layout separately from leasing information, management teams can use the platform to understand how individual units are occupied and how different areas of the property are being used.

The system also supports technical management. Users can examine floor plans and sections, move from an overview of a property to individual rooms, take measurements and identify equipment located within particular areas. This can reduce the need to search through multiple sets of drawings and documentation when planning maintenance, refurbishment or investment works.

Nhood has also incorporated leasing and financial information into the platform. Individual premises can be organised according to their function or tenant category, allowing leasing and asset-management teams to assess the composition of a shopping centre alongside its physical layout.

This integration is potentially significant for existing retail properties, where changes to tenant requirements increasingly require landlords to understand not only the commercial terms of a lease but also the technical implications of dividing, combining or adapting space.

Jacek Bendyk, Technical Leader at Nhood Poland, said consolidating previously fragmented building information allows teams to work from a more consistent picture of each property. According to Nhood, this can make planning maintenance, refurbishment and capital expenditure more efficient.

The Polish implementation currently covers 14 Ceetrus properties managed by Nhood, with assets located across markets including Gdańsk, Rumia, Bydgoszcz, Poznań, Piaseczno, Warsaw, Białystok, Rzeszów, Kraków, Bielsko-Biała, Mikołów and Żory. Together, the properties represent around 200,000 sqm.

The technology has already been introduced on a substantially larger scale elsewhere in Europe. Nhood reports another 91 locations using the system outside Poland, including 57 properties in France, 22 in Spain, nine in Romania and two in Portugal, as well as a deployment in Luxembourg.

The expansion of digital twins into operational property management represents a shift from their more familiar role in design and construction. For existing commercial buildings, their value increasingly lies in creating a common information environment that can support decisions throughout the asset’s operating life.

For shopping centres in particular, where landlords continuously manage tenant changes, technical installations, refurbishment programmes and capital expenditure, connecting these different layers of information could become increasingly useful. The larger question will be whether owners can translate improved access to property data into measurable reductions in operating costs, faster leasing decisions and better allocation of investment capital.

BESTSECRET Takes 108,000 sqm at EQT Park Poznań Żerniki

BESTSECRET has agreed to lease 108,000 sqm at EQT Park Poznań Żerniki in one of the largest warehouse transactions announced in Poland during 2026, strengthening the role of the Poznań region as a major distribution base serving both domestic and Western European markets.

The agreement was signed with EQT Real Estate through the EQT Exeter Europe Logistics Value Fund IV. The property will be adapted to accommodate BESTSECRET’s European e-commerce operations, including order processing and distribution for the company’s online fashion business across 27 countries.

While the lease covers 108,000 sqm, the building contains a four-level internal operational mezzanine that increases the space available for logistics activities to approximately 188,000 sqm. The multi-level configuration is designed to accommodate intensive picking, handling and fulfilment operations associated with large-scale e-commerce.

The facility was completed in 2021 and already incorporates infrastructure required for high-volume logistics operations, including extensive loading areas, car and truck parking and a three-storey office component.

EQT Park Poznań Żerniki is located near the S11 expressway in Żerniki, providing connections with the Poznań metropolitan area and the A2 motorway. The location gives occupiers access to one of Poland’s principal east-west transport corridors and provides onward connections towards Germany and other Western European markets.

An important aspect of the transaction is the transition between occupiers. EQT Real Estate said BESTSECRET is taking over the facility immediately following the departure of the previous tenant, meaning the property avoided an intervening period without an occupier.

For an asset exceeding 100,000 sqm, the immediate re-leasing is particularly significant. Very large logistics buildings can present greater leasing exposure when an occupier leaves because the number of companies capable of absorbing such substantial facilities is considerably smaller than for conventional warehouse units.

Marcin Sabala, Development and Leasing Director Poland at EQT Real Estate, said the transaction demonstrates continuing occupier interest in large logistics properties combining established locations with technical infrastructure capable of accommodating complex distribution operations.

The BESTSECRET agreement also demonstrates the distinction emerging within Poland’s warehouse market between overall availability and the supply of buildings suitable for major occupiers. Large e-commerce and distribution companies increasingly require properties capable of supporting automation, high-volume order processing and substantial employee and transport flows, narrowing the pool of buildings that can accommodate their operations without extensive redevelopment.

Poznań is particularly well positioned for this type of requirement because of its proximity to Germany, motorway infrastructure and established logistics base. These characteristics have made the region an important location for companies using Poland as a distribution platform for wider European operations.

The 108,000 sqm BESTSECRET lease therefore represents more than a large individual letting. The ability to replace a major occupier without a vacancy period provides a notable test of liquidity on the occupational side of the market and illustrates the continuing demand for large, technically capable logistics assets in Poland’s established distribution hubs.

Consulting Firm Renews 550 sqm at Gdańsk’s Tryton Business House

An international consulting company has extended its lease at Tryton Business House in Gdańsk, retaining 550 sqm of office space in the Globalworth-owned building.

The renewal continues the occupier’s existing relationship with Globalworth and provides another example of tenant retention becoming an important component of leasing activity in established office properties.

According to Globalworth, the company decided to remain at Tryton Business House following its experience at the property, with workplace conditions, technical quality and environmental considerations among the factors influencing the decision. The office also supports the tenant’s internal requirements concerning responsible business and sustainability.

For office landlords, retaining existing occupiers has become increasingly important as companies take a more selective approach to their workplace strategies. Decisions to renew are increasingly influenced not only by location and rental terms but also by building performance, employee experience and whether properties can support corporate environmental objectives.

Agnieszka Głuchowska, Asset Management & Leasing Manager at Globalworth, said the renewal demonstrates the importance of active property management and maintaining buildings to standards that correspond with changing occupier requirements.

The transaction also highlights the role that asset management can play in protecting occupancy at existing office properties. As companies reconsider how much space they require and place greater emphasis on the quality of the offices they retain, landlords face increasing pressure to invest in buildings throughout their ownership rather than relying primarily on location to maintain demand.

For Tryton Business House, the 550 sqm renewal preserves an existing international occupier and adds to leasing continuity at the Gdańsk property. While relatively modest in size, the agreement reflects a broader shift in mature office markets where successful tenant retention can be as commercially important as securing new companies.

Prague 4 and Skanska Upgrade Pankrác Pedestrian Connection Ahead of Future Development

A pedestrian underpass near Prague’s Pankrác district has reopened following improvement works carried out through cooperation between Prague 4 and Skanska, providing a more direct route beneath the busy 5. května road.

The project is an interim intervention intended to improve movement through the area while longer-term development plans for neighbouring land are still being prepared. The reopened passage connects the area towards Sdružení Street and reduces the number of surrounding roads pedestrians need to cross. It is expected to be particularly useful for children and parents travelling to a nearby primary school.

Work on the underpass was completed over recent weeks and included removing construction debris, cleaning existing structures and creating a defined pedestrian corridor. Lighting was installed, while temporary barriers and other measures were introduced to separate people using the route from adjoining areas.

Prague’s Technical Road Administration also carried out maintenance and repairs to the bridge above the passage. These included cleaning, removal of deteriorated concrete, corrosion protection for exposed reinforcement, concrete restoration and protective treatment of repaired surfaces. The bridge is currently being secured and monitored while construction work on Prague’s Metro Line D continues.

The timing of the reopening coincides with the beginning of the new school year. Prague 4 Mayor Ondřej Kubín said the intervention provides an immediate improvement for residents rather than requiring them to wait for the wider transformation of the area to take place.

The project also has a longer-term property development connection. Skanska owns neighbouring land where it is preparing a future commercial development. Martin Zemánek, Project Manager for Commercial Development at Skanska, said the company wanted to deliver a practical improvement for the surrounding community while its plans for the adjacent site remain at the preparation stage.

The appearance of the underpass was developed with students from the Ladislav Sutnar Faculty of Design and Art at the University of West Bohemia in Plzeň. Their involvement also connects the temporary project with plans for a future street in this part of Prague named after Czech designer Ladislav Sutnar.

The intervention provides a small-scale example of how public authorities and private developers can improve connections around development sites before larger construction projects move forward. Such temporary measures can be particularly relevant in districts undergoing significant infrastructure change, where redevelopment and transport construction may otherwise disrupt established pedestrian routes for several years.

For Pankrác, the reopened passage provides an immediate improvement to pedestrian connectivity while work on Metro Line D and preparations for the longer-term transformation of the surrounding area continue.

Power, Fibre and Land Reshape Africa’s Emerging Data Centre Investment Map

Africa’s rapidly expanding digital economy is creating a new infrastructure investment cycle, with data centres moving from a relatively specialised technology segment towards an increasingly important part of the continent’s property, energy and communications landscape.

The scale of the opportunity is considerable. Africa currently has only a fraction of the computing infrastructure found in Europe, North America or Asia, despite its large and increasingly connected population. Industry forecasts indicate that data-centre capacity could multiply several times before the end of the decade, potentially requiring between US$10 billion and US$20 billion of additional investment.

Cloud services are one of the main forces behind the expansion, but they are no longer the only driver. Financial technology, mobile banking, e-commerce, streaming, corporate digitalisation and public-sector technology are generating greater volumes of locally produced data. Artificial intelligence is adding another source of demand, while international technology companies increasingly need infrastructure capable of processing information closer to African customers.

The result is an emerging development market that extends well beyond the buildings themselves. Large data centres require substantial electricity connections, resilient telecommunications networks, secure sites, suitable planning conditions and room for future expansion. This combination means that only a limited number of African cities currently possess all the ingredients necessary to support major concentrations of capacity.

South Africa remains comfortably ahead. Johannesburg has developed the continent’s deepest data-centre ecosystem, supported by its position as Southern Africa’s principal corporate and financial centre. The city combines large business demand with extensive telecommunications infrastructure and the presence of major international technology companies. Cape Town provides South Africa with a second important cluster, benefiting from international connectivity and its growing technology sector. Together, Johannesburg and Cape Town give the country an infrastructure base that emerging African markets will take time to replicate.

The next stage of South African development is nevertheless likely to be shaped increasingly by electricity availability. Data centres are unusually power-intensive assets, and the rapid growth of AI computing is increasing electricity requirements further. Developers able to secure dependable large-scale connections, renewable generation and supporting power infrastructure could therefore gain an important competitive advantage.

Nigeria presents a different growth story. Its strength comes primarily from the scale of its domestic economy and the accelerating digitalisation of financial services, telecommunications and consumer activity. Lagos is the natural centre of this expansion. Its enormous population and concentration of banks, fintech businesses, telecommunications operators and corporate users provide a substantial customer base for locally hosted computing capacity.

New developments also demonstrate that Nigeria is beginning to move towards larger facilities. Open Access Data Centres has been developing a Lagos campus designed for significantly greater capacity than the smaller facilities historically common in the market. Telecommunications groups are also expanding their digital infrastructure operations as demand for cloud and data services grows.

Nigeria’s challenge is converting this demand into infrastructure that can operate reliably and competitively. Electricity supply remains particularly important because dependence on expensive backup generation can materially affect operating costs. Sites offering stronger grid access or the ability to integrate alternative power sources could therefore become increasingly valuable.

Kenya is developing into the strongest East African contender. Nairobi already has an established technology and financial-services sector, while Kenya’s international fibre connections provide access to global communications networks through the country’s Indian Ocean coastline. Its energy system could become an additional advantage. Kenya has substantial renewable electricity generation, including geothermal resources, creating the possibility of supporting future data-centre growth with comparatively low-carbon power.

Large international technology investment is reinforcing this position. Plans for new cloud and computing infrastructure have placed Kenya firmly on the map for developers seeking an East African location capable of serving both domestic and regional demand. Current development forecasts point towards a significant increase in Nairobi’s operational capacity over the next several years.

North Africa offers another set of opportunities. Egypt occupies an important position on telecommunications routes linking Europe, Asia, the Middle East and Africa. This geographical advantage gives the country strategic importance within the international fibre network and creates potential for further data-centre investment around Cairo and other connected locations.

Morocco could emerge through a different combination of advantages. Its proximity to Europe, expanding digital connectivity and substantial investment in renewable electricity make it potentially attractive for facilities serving both African demand and international workloads. The country’s position close to Southern Europe could become particularly relevant as developers search for locations where land, energy and infrastructure can be secured more economically than in some mature European data-centre markets.

Despite these opportunities, Africa’s expansion will ultimately depend on the physical infrastructure behind the digital economy. Electricity is likely to become the most important development constraint. A major data-centre campus can require power on the scale of a large industrial facility, while AI-oriented installations are pushing computing densities and electricity requirements considerably higher.

This means that development decisions will increasingly depend on whether sufficient power can actually be delivered to a site rather than simply whether land is available. Renewable generation, battery storage and dedicated energy infrastructure are consequently becoming part of the property development equation.

Water is another consideration, although its importance varies according to climate and cooling technology. Developers operating in water-stressed locations will increasingly need systems capable of limiting consumption while maintaining reliable operating temperatures.

Connectivity presents the other side of the equation. New submarine cables and expanding terrestrial fibre networks are increasing the volume and resilience of Africa’s international communications links. Better connectivity strengthens the economic case for processing more African data within the continent rather than routing workloads through distant international facilities.

For commercial real-estate investors, these requirements are creating an increasingly specialised property sector. A suitable data-centre site is not simply industrial land with a large building. The most valuable locations combine access to substantial electricity capacity, multiple fibre routes, security, appropriate planning conditions and sufficient surrounding land for expansion.

That could create a new category of strategically valuable development sites around Africa’s largest cities. Locations positioned close to major substations, fibre corridors and renewable-energy resources may attract growing interest from operators, infrastructure funds and institutional investors.

The investment map towards 2030 is therefore becoming more defined. South Africa should remain Africa’s largest established data-centre market, with Johannesburg retaining a substantial advantage in existing infrastructure and customer depth. Lagos has the potential to become the dominant West African cluster as Nigeria’s digital economy expands, while Nairobi is increasingly positioned as East Africa’s principal hub.

Egypt and Morocco provide additional opportunities in North Africa, particularly where international connectivity, renewable power and proximity to overseas markets can be combined. Other African cities will undoubtedly attract development, but growth is unlikely to be evenly distributed. Capital should concentrate first in locations capable of providing the infrastructure needed to operate increasingly large and power-intensive facilities.

Africa’s next digital infrastructure winners may therefore be determined by something far more tangible than internet growth alone. The cities able to secure reliable electricity, international fibre connectivity and development-ready land are likely to capture the largest share of the billions of dollars expected to flow into the continent’s data-centre sector before 2030.

Ruda Śląska to Gain New 6,580 sqm Retail Development

A new retail park is planned for the Kochłowice district of Ruda Śląska, with developer Merkury preparing a 6,580 sqm scheme scheduled to open in spring 2028.

Scallier has started leasing the project, which will be developed on a site of more than one hectare on Józefa Piłsudskiego Street. The property will provide approximately 6,580 sqm of leasable retail and service space together with parking for 111 vehicles.

The location combines a substantial residential catchment with access to the Upper Silesian road network. The site is surrounded by both houses and larger residential estates and is positioned close to the A4 motorway.

The Drogowa Trasa Średnicowa is approximately 2 km from the development, providing connections across the Upper Silesian-Zagłębie metropolitan area, including towards Katowice, Chorzów, Zabrze and Gliwice. Józefa Piłsudskiego Street itself provides an important local connection through this part of Ruda Śląska.

The development is being positioned primarily around everyday shopping and services for the surrounding population. Its proximity to major transport routes could also broaden the potential customer base beyond residents living immediately around the property. The planned layout will allow retail units to be adjusted to accommodate different occupier sizes and requirements.

Kochłowice has around 30,000 inhabitants, compared with approximately 126,000 across Ruda Śląska. Located in the southern part of the city, the district sits close to Katowice, Chorzów and Mikołów, placing the project within one of Poland’s most densely interconnected urban areas.

The development comes amid continued investor and developer interest in Polish retail parks. Scallier points to stronger investment activity in the broader retail property market during the first six months of 2026 and continued demand from retailers for accessible and cost-efficient locations.

The Kochłowice project also reflects the evolution of the retail park model in Poland. While the sector initially expanded strongly in smaller regional cities, new developments are increasingly targeting established districts within larger metropolitan areas, where developers can combine concentrated residential demand with strong transport accessibility.

For Ruda Śląska, the planned 2028 opening will introduce another modern retail destination into an already highly urbanised part of Upper Silesia. Its eventual performance will depend on the tenant line-up secured during the leasing process and its ability to capture regular spending from the surrounding residential population as competition between convenience-led retail formats continues to increase.

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