AFIRE 2026 Mid-Year Pulse Report: Tracking Institutional Sentiment and CRE

The resultant reports thus provides an ongoing narrative of how the US fares in the global real estate economy, and perhaps just as importantly, how real estate fares in the larger investment ecosystem.

Because it’s tied to real assets, real estate is the core of the investment practice, but as other global historical forces (conflagrations, currencies, coalitions) are now reshaping the origination, storage, and generation of financial value, we are seeing the definition of “real estate” evolve in real time—starting with the industry’s growing appetite for infrastructure, credit, and new ventures.

REALLOCATING REAL ESTATE

For initial reference in AFIRE’s mid-year survey, conducted throughout July and August of 2026, this evolving definition of real estate is initially mapped in the 2025 Real Estate Allocations Monitor produced by Cornell University’s Baker Program in Real Estate and Hodes Weill & Associates, L.P.[i] The headline of the report shows that, “after holding allocations steady from 2022 through 2024, institutions decreased target allocations by 10 basis points in 2025, marking the first decline since the survey’s inception in 2013.”

But investment allocations haven’t dropped overall—they’re reorganizing in real time. So to start with our mid-year check-in, we asked two key questions to start:

• Looking towards the end of 2026, what is your organization’s current outlook for US real estate allocations?
• Weighing real estate against other investment allocations through the end of 2026, does your organization expect any other increases or decreases in the following categories?

And as we see in Exhibits 1 and 2, the majority of respondents (around 53%) are pulling back are holding steady on their overall US allocations—but investments into infrastructure, private credit, and venture capital are expected in increase apace.

AFIRE’s core mission is organized around global investment into US real estate, so it is likely that the “other” 46% of AFIRE’s membership carries an above-average optimism about US investment, though this optimism might simply represent the activity around reapportionment and the turn to infrastructure (55% increase), private credit (43% increase), and so forth.

ECONOMIC AND PROPERTY SECTOR OULOOK

As shown in Exhibit 3, what we are seeing is perhaps not optimism, but caution. At mid-year in 2025, we asked respondents to rank their view of the US economy, relative to other global regions. At the time, more than 60% of respondents expressed a positive/very positive outlook. That number has declined only slightly—to around 58%—but the share of those with no opinion has diminished from 25% to 16%, and the share of those with a negative outlook has more than doubled, from 12.5% to nearly 27%.

Those with a positive outlook cite the current US GDP, demographic trends, and labor and employment data as key referents, but less enthusiasm or conviction than those citing the US political environment, inflation data, and interest rates as the key referents for their negative outlook. Of those with a negative outlook, more than 90% of respondents cite the US political landscape as detrimental. (As with other types of investments, it is often those criteria outside the realm of control that exert the greatest influence.)

Amidst these changes in macroeconomic sentiment, the survey drilled down deeper into sector-specific outlooks for US real estate in particular. Of those optimistic about US real estate, the outlook for industrial, multifamily, and office top the list, as shown in Exhibit 4, with industrial charting a nearly 80% net positive outlook. Multifamily trails at more than 70%, tied overall with office, which has a higher “very positive” score of nearly 10%.

Data centers top the list in terms of total “very positive” indications, at nearly 25%, for a total net positive score positioned between hospitality and single-family rentals. But as shown in Exhibit 5, data centers rank in the top five as both the greatest opportunity and greatest risk for US property sectors over the next 12-18 months.

And as distinct from multifamily housing, investors are seeing a growing opportunity in senior housing over this next investment period, highlighting a growing demand as has been forecasted by several Summit Journal contributors over the past several years.[ii]

AGREE OR DISAGREE?

Zooming back out, the survey asked respondents a series of agree/disagree topics organized around the same issues addressed in the Exhibit 3 section—including a revisitation of a few key questions asked at this time last year.

As shown in Exhibit 6, fewer respondents indicate that there will be increased divestment from US real estate by foreign investors over the next year (declining from 45% to 24% in agreement). However, the notion that foreign investors will simply remain in a “hold” pattern has declined in popularity, from 84% in agreement to just about 50%. Despite this, there has been a marked increase in those holding the view that the US will see an improvement in fundamentals over the next year, with nearly 75% in agreement, compared to just over 50% at this time last year.

Meanwhile, the survey also asked respondents a series of new agree/disagree questions. Almost universally (94%), respondents believe that the current environment favors investors with available capital, and as much available patience.

The economic volatility and geopolitical tensions of the moment are creating an atmosphere of opportunity and resiliency for US real estate, but some of this opportunity may also be realized in the infrastructure sector, as infrastructure investments are poised to become a higher priority (79% agree), and will grow alongside private credit as competitive with more traditional real estate investments (83% agree).

Despite this outlook—and hearkening back to the dampening effect of US policies on foreign investment—the majority of respondents (55%) agree that US policy as it relates to immigration will have a material impact on CRE.

(For context, population growth in the US has slowed significantly, with an increase of only 1.8 million (0.5%) between July 1, 2024, and July 1, 2025—the nation’s slowest population growth since the early period of the COVID-19 pandemic. And the US Census Bureau primarily cites the loss of international migration as the main factor contributing towards this diminution.[iii]

Interestingly, this question also generated the greatest amount of outright disagreement (around 30%) or abstentions (15%), underscoring the fact that politically sensitive topics continue to be contentious among investors.

. . . but at the same time, facts are facts, and a US population cutting itself off from foreign immigration—and slowing birth rates—will have inevitable effects on US real estate performance; especially that in the housing sector, where population rates have a direct relationship to near-term supply, long-term demand, cross-border sentiment, and talent and investment decisions, as shown in

Rather than asking a series of simple binary agree/disagree statements around housing, respondents ranked their sentiment along a sliding scale, revealing a general average of agreement (around 60%) around the idea that slower US population growth and labor force expansion will constrain the delivery of new real estate. Despite this, investors are equally split on the long-term demand effects of slowing population growth.

Investors overwhelmingly agree that the US will remain a destination for long-term investment, despite these demographic headwinds—though this is directly tied to the rational notion that the ability of the US to attract and retain global talent is a determinant of its long-term real estate performance (no respondents expressed strong disagreement around this belief).

ENERGY AND AFFORDABILITY

In addition to known external challenges around US migration and demographic trends, investors are also contending with the reality of energy availability and infrastructure in the US.

As shown in Exhibit 8, more than 60% of respondents are counting energy availability as a material consideration for their market and product selection—though only 35% are citing capacity constraints as a cause to reconsider certain US markets.

But overall, 85% of respondents agree that markets with reliable and expandable energy infrastructure will attract a greater share of institutional capital over the next five years.

Relatedly, demand for electric power from AI and data centers is overwhelmingly influencing real estate decisions—even beyond the data center sector itself, as shown in Exhibit 9.

According to Forbes, US data centers currently consume roughly 4.4% of total US electricity, and the US uses nearly 40% of all electricity dedicated to data centers globally.[iv] Meanwhile, the cost of energy is up more than 6.2% year-over-year, as of August 2026.[v]

So as data centers eat up a growing share of energy usage, and US consumers (who are already being stretched) pay more for personal energy usage, consensus around the effects of electric demand will likely continue to grow.

Despite the challenges of energy usage and storage in the US, investors are seeing themselves as increasingly emboldened for implementing possible solutions, especially as governmental regulation or investments in the energy grid lag the actual uses and needs of energy generation. As such, the survey revisited a question we asked at this point last year, with respondents indicating which “levers” investors can pull to help guide the energy transition themselves, as shown in Exhibit 10.

The share of investors who cited “internal capacity building” has diminished by nearly 58% since 2025, with more investors now citing direct investment in infrastructure (66%) and prioritizing sustainable or energy-efficient properties (47%) as some of the most critical tools on the investor side.

These are followed by influence in the private market, or overall portfolio design, both of which have grown in perceived importance or efficacy compared to this point last year.

Despite the actions investors themselves can take around energy investment and infrastructure, the question of energy and affordability in the US are inextricably linked, as shown by the investor response mapped in Exhibit 11, which almost copies the electric demand question from Exhibit 9.

In other words, just as much as demand for electric power is influencing market selection, housing and affordability challenges will impact residential real estate performance.

These challenges are intertwined, because they rely on the health of the US consumers (themselves the longtime drivers of the US economy). And as shown in Exhibit 12, consumers and households are feeling the pinch. Even more than at this point last year.

Nearly 20% of households may already be at the breaking point for affordability, and the share of those on the precipice has grown from 49% to 55%—now the majority. And a shrinking slice (5%, down from 6%) can continue to shoulder increased costs. But as shown in Exhibit 13, there are some actions that investors can take to do their own part to alleviate these stresses (and still maintain expected residential real estate performance), including increases in workforce and “missing middle” housing alongside local zoning and land use reform.

APPETITE FOR RISK

While investors understand what they can and can’t do to alleviate some of the real estate-adjacent stresses (energy and affordability in the US), this understanding is ultimately subordinated by the larger mapping of risk tolerance and management for US real estate, as shown in Exhibit 14.

As consumers themselves, investors and owners are currently pressed by the actual capex and opex costs of their investments—including growing insurance expenses. These concerns are followed by transportation and logistics access (around 95% net important for risk criteria), reflecting concerns around the current excitement of the US industrial sector.

Regulatory issues (93% net important) and digital connectivity (83% net important) round out the top five risk concerns of the moment, though it’s important to note here that none of the criteria listed for the question fall below 65% in terms of total importance for current risk equations. In other words, caution abounds—but even amidst the current challenges, opportunity abounds as well.

+ ISSUE 22

NOTE FROM THE EDITOR: ISSUE #22

AFIRE 2026 Mid-Year Pulse Survey Report (P. 6)

Market Mitigation: American Economic Power Translates into CRE Opportunity (P. 18)

Real Estate in the Next Cycle: A New Generation of Investment Ideas for the Built Environment (P. 26)

The Narrow Gate: Who Actually Raises Foreign Capital for US Real Estate (P. 36)

Middle East Institutional Capital and US Real Estate: Are They Still Friends?(P. 42)

Arbitrage in Plain Sight: How “Bucketized” Capital and Lost Skills Leave Billions on the Table (P. 52)

Real Estate Credit Reimagined: Private Credit and Debt Capital Markets (P. 60)

(Re-)Industrial Demand Drivers: From Efficiency to Resiliency (P. 66)

Zombie Funds or Patient Capital: Age Alone Cannot Distinguish a Stagnant Fund from a Disciplined Vehicle (P. 72)

Upending Underwriting: Fat Tail Risks in North American Office Investments (P. 76)

The Economics of Place: Quantifying the Mixed-Use Premium (P. 82)

The Overlooked Gateway: Opportunity Zones and Cross-Border Capital (P. 88)

Opportunities in Pro-Housing Policy Shifts: Investing in Markets with Public Policy Support (P. 94)

Rethinking Luxury Hospitality: Transforming Complexity into Long-Term Value (P. 100)

Before the Next Decision: Field Work to Organizational Capability (P. 108)

The Maturity Wall Is Already Here: Why the Headline CMBS Delinquency Rate Understat

+ ALL ARTICLES

+ ARCHIVE

+ LEADERSHIP

+ POLICIES

+ GUIDELINES

+ CONTACT

+ MEDIA KIT (PDF)

DISCLAIMER

The publisher of Summit is not engaged in providing tax, accounting, or legal advice through this publication. No content published in Summit is to be construed as a recommendation to buy or sell any asset. Some information included in Summit has been obtained from third-party sources considered to be reliable, though the publisher is not responsible for guaranteeing the accuracy of third-party information. The opinions expressed in Summit are those of its respective contributors and sources and do not necessarily reflect those of the publisher.