Real estate must prove its worth

As to the economic role of real estate, the levelling-up agenda is centre stage. The Centre for Cities calculates that the levelling-up challenge will be four times harder after the pandemic in terms of people in northern cities getting better opportunities. As investors, we will need to adapt but also behave with the long term in mind, to ensure that levelling up leads to a positive re-rating of towns with potential, rather than an averaging down of already successful areas.

 

In parallel, potentially significant changes are on the way from RICS, where a fundamental review of the approach to valuation is taking place that could either enhance the status of the sector or protect an unsatisfactory status quo.

 

Simultaneously, the government has announced its intention to conduct a root-and-branch review of the relationship between landlords and tenants, potentially leading to changes in primary legislation, which in turn could enhance or undermine investors’ confidence in the sector. This project will have a generational impact, and its importance must not be underestimated.

 

Finally, in a year in which climate change is firmly on the agenda with only six months to go until COP26, investing in a sustainable future and working to deliver a transition to net zero has never been more urgent.

 

The need to ‘build back better’ is not a simple task. Like never before, the real estate investment sector needs to innovate, adapt and prove the scale of positive contribution it can make to society.