"Predictions are difficult, especially when they concern the future. So, rather than read the future in the coffee grounds of Pierre Dac or someone else, we took the pulse of decision-makers on the eve of the world's leading real estate event, the Mipim trade show.
What can we learn from our 2025 Leaders' perspective survey? Firstly, that the divorce between real estate bosses and Emmanuel Macron has been consummated. Over and above the President's contempt for real estate in general, and housing in particular, the dissolution of the National Assembly was the last straw.
Nothing seems likely to lift the spirits of real estate decision-makers, not even the easing of financing conditions and the announced fall in interest rates. With inflation down to 2%, the European Central Bank has every opportunity to reduce its key rates to between 1.75% and 2.25% as early as this year.
The only problem is that political uncertainties are disrupting this long, tranquil river. Isabelle Job-Bazille, head of economic research at Crédit Agricole, sums up the situation very well. The main threat to France would be an Italian-style scenario, with sovereign interest rates drifting and tighter financing conditions damaging investment, particularly real estate.
We could add geopolitical risk to this. The elephant in the room, according to Isabelle Job-Bazille. So much so that forecasters no longer work on a "central scenario", but on risk scenarios.
And among the risks identified in real estate, it's the office sector that stands out first. The overwhelming majority of leaders surveyed (82%) believe that companies will reduce their consumption of square meters over the next three years. All decision-makers (97%) admit that some office buildings will never find tenants again. Not in Paris, where centrality still acts as a shield for investors.
All that remains is to look for pockets of value creation. For investors, the trifecta at the dawn of spring 2025 is hotels, logistics and residential. In any order you like.
But these assets have to be sourced, manufactured and operated. Often from existing assets. The real estate industry's talent will then lie in transforming the city's modeling clay, freeing it from layers and layers of regulation.
After all, "the most reliable way to predict the future is to create it". Abraham Lincoln.