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As the demise of the office component in real estate allocations continues investors are favouring data centres, warehousing and low cost accommodation.

Office and bricks and mortar retail have suffered most at the hands of the pandemic. However, the pandemic-triggered impact on real estate from working from home and buying online varies across regions. For example, UK department stores and malls have been hit harder than their German counterpart, typically characterized by a grocery anchor.

Offices able to offer sought-after locations which help companies showcase their brand will thrive most. Moreover, offices in cities like Tokyo, where many employees’ preference is to come into work rather than work from home, will also thrive. In contrast, demand from office space in city’s like San Francisco, where most workers are now fully remote will stay weak. London offers opportunities for office investors. The pricing is much softer on a Brexit discount compared to other European capitals.