A new research report from the Observer Research Foundation projects that real estate fund managers face both a historic opportunity and intensified competition as an estimated $90 trillion in wealth transfers across generations over the next two decades. The analysis, authored by Alexis A. Crow and published in June 2026, examines how shifting portfolio allocations could redirect capital flows into commercial real estate.
High net worth individuals and family offices currently hold approximately 20 percent of average portfolios in real assets or private markets, according to the research. Should retail capital follow this allocation pace—potentially prompted by regulatory changes allowing more private assets in retirement plans—some $18 trillion could flow into private markets over the coming years.
The report arrives as the commercial real estate cycle shows signs of turning, with price appreciation gradually improving for the European commercial real estate basket and the United States demonstrating early-stage recovery. Global investors have increasingly turned to real estate as a classical inflation hedge amid resurgent inflation across many economies and geopolitical disruption including the Iran war.
Real estate has competed with other elements of the private markets landscape as investors have increased allocations to private equity and infrastructure across jurisdictions. Private credit had magnetised flows away from traditional real estate allocations in recent years, the research notes, but large-scale redemption requests in the private credit space have renewed interest in real estate as a portfolio hedge.
The analysis challenges conventional assumptions about real estate performance across property sectors. Retail assets delivered the highest returns across the property index in the United States in 2025, despite longstanding predictions that e-commerce would trigger a collapse in retail real estate. Office assets have similarly defied predictions of collapse from work-from-home trends following the COVID-19 pandemic.
Data centres have captivated patient investor capital and construction activity with investments amounting to trillions of dollars in recent years, representing what the research describes as the consummate convergence between real estate and infrastructure. The report positions residential and logistics assets alongside property technology as powerful themes over the past two decades.
On the institutional side, general partners will need to offer limited partners an enticing vision as those limited partners increasingly consider direct investments rather than fund vehicles. The research emphasises that households and regulators will require confidence in durable investor protections, noting that placing retail capital into illiquid assets can prove fraught with fear and create runnable scenarios.
The report argues that the most formidable investing themes may emerge from overturning previously held convictions about fiscal and monetary policy, the geopolitical landscape, and demographics. By adopting what the research terms a clear-eyed view of the changing macroeconomic and geopolitical landscape, investors and developers can develop themes to guide decision-making about capital availability, portfolio selection, and asset-level operations.
Fund managers will need compelling insights to attract capital into real estate as an ever-growing share of portfolios shifts toward alternative assets, according to the analysis. Standing in competition with credit, infrastructure, and private equity managers, real estate fund managers and developers must offer a vision of how real estate can deliver superior performance and value appreciation over the long term as the asset class transitions from what the research describes as a beta to an alpha type investment.