Alts’ tenacity, tested once more

An introduction from Norman Niemer

Head of Real Estate, Research & Strategy – US

"We anticipate modest appreciation as interest rates remain elevated, with success hinging on thoughtful allocation to resilient sectors and on active management strategies."

As we navigate the ever-changing landscape of the US economy and commercial real estate markets, it’s clear that fluidity and uncertainty remain defining features of the current environment. The first quarter of 2026 has tested resilience across sectors, with macroeconomic pressures such as trade tensions, conflict in the Middle East, and accelerating inflation presenting new challenges to navigate.

Despite these headwinds, the US economy demonstrated resilient growth. Notably, investment in artificial intelligence (AI)-related assets drove much of this activity, underscoring the transformative impact of technology on productivity and business expansion.

Within commercial real estate, signs of stabilization have emerged. Debt availability has improved markedly, transaction volumes are rising, and liquidity conditions are more favorable, even as financing costs remain elevated. Sector performance remains uneven across property types, though income stability continues to be a key driver of total returns.

Looking forward, we believe investors should embrace a measured outlook, recognizing that potential opportunities exist, but that selectivity and risk management are paramount. We anticipate modest appreciation as interest rates remain elevated, with success hinging on thoughtful allocation to resilient sectors and on active management strategies. However, structural changes, such as the adoption of AI and demographic trends, can provide opportunities for value creation.