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Real Assets

Real Estate Regional InsightsRealEstateRegionalInsights

Mar 24, 2025

5 mins

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As it stands, the news flow is generating record-high policy uncertainty, amplifying risks to the economic outlook. Even without decisions being finalized, uncertainty hurts sentiment, and the longer that continues, the more it weighs on activity.

But with real estate fundamentals holding up – ongoing employment growth, low unemployment rates and inflation and interest rates trending down, and all largely in a world with limited supply – how much at risk is the real estate recovery?

That question lies at the heart of PGIM Real Estate’s latest investment research insights, which are trying to better understand how resilient the real estate outlook is. To address these complexities, the team has called in extra expertise – broadening their insights to now cover global credit and Mexico.

  • UNITED STATES: What happens to real estate values now that interest rates are higher and how does productivity impact real estate performance?
  • EUROPE: Have higher government bond yields changed the real estate outlook and what does an analysis of affordability mean for office rental growth forecasts?
  • ASIA PACIFIC: How does infill development affect the link between economics and rental growth and is this being missed by forecasters?
  • MEXICO: What does tariff uncertainty mean for industrial investment and which markets benefit most from higher productivity?
  • PRIVATE CREDIT: How will a higher U.S. 10-year treasury yield affect the commercial real estate (CRE) credit landscape, how will rising benchmarks affect the risk-return outlook for CRE credit and how will the recovery in real estate markets create new financing opportunities?
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While uncertainty continues to challenge sentiment and activity, the underlying resilience in real estate fundamentals not only helps us understand whether the current recovery is at risk, but also uncovers compelling areas of investment opportunities.
Dr. Peter HayesGlobal Head of Investment ResearchPGIM Real Estate

For Financial Professional Use Only. Not for use with the public.

The views expressed herein are those of PGIM Real Estate investment professionals at the time the comments were made and may not be reflective of their current opinions and are subject to change without notice. Neither the information contained herein nor any opinion expressed shall be construed to constitute an offer to sell or a solicitation to buy any security.

Certain information in this commentary has been obtained from sources believed to be reliable as of the date presented; however, we cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. The manager has no obligation to update any or all such information, nor do we make any express or implied warranties or representations as to the completeness or accuracy. Any projections or forecasts presented herein are subject to change without notice. Actual data will vary and may not be reflected here. Projections and forecasts are subject to high levels of uncertainty. Accordingly, any projections or forecasts should be viewed as merely representative of a broad range of possible outcomes. Projections or forecasts are estimated, based on assumptions, subject to significant revision, and may change materially as economic and market conditions change. 

This material is being provided for informational or educational purposes only and does not take into account the investment objectives or financial situation of any client or prospective clients. The information is not intended as investment advice and is not a recommendation. Clients seeking information regarding their particular investment needs should contact their financial professional. 

Prudential Investment Management Services LLC is a Prudential Financial company and FINRA member firm. PGIM Investments is a registered investment advisor and investment manager to PGIM registered investment companies. PGIM Real Estate is a unit of PGIM, a registered investment advisor. All are Prudential Financial affiliates.

© 2025 Prudential Financial, Inc. and its related entities. PGIM, PGIM Investments, PGIM Real Estate and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide. 

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