PROPERTY SCENARIOS/ASSUMPTIONS
SCENARIO 2 C&W Baseline
SCENARIO 1 Productivity-Led Expansion
SCENARIO 3 AI Bust - Slowcession
SCENARIO 4 Dystopic/Displacement
50% Probability
15% Probability
25% Probability
5% Probability
• Logistics & Industrial : Automation reduces some labor needs, but rising consumer demand drives steady demand for logistics & industrial space. • Office: Robust demand maintained, driven first by regional expansion and then by business formation and profit growth. • Retail: Retail labor is partially automated, but consumer spending growth supports moderate retail space demand. • Property values: Appreciate throughout the forecast horizon as supply/demand dynamics continue to improve.
• Logistics & Industrial: Weaker consumer demand and delayed capital spending slow absorption, softening logistics & industrial space demand. • Office: Job losses and weaker business confidence reduce • Retail: Pullbacks in discretionary spending weigh on retail sales, leading to weaker retail demand. • Property values: Weaker fundamentals and tighter financial conditions place downward pressure on values over the forecast period. office usage, pressuring demand and vacancy.
• Logistics & Industrial: Automation reduces labor needs, but weaker consumption limits growth in logistics & industrial space demand. • Office: Job displacement and cost-cutting reduce office usage, weighing on demand.
• Logistics & Industrial: Automation deepens, but stronger output, consumer demand and a higher share of online-spending drive above- baseline demand for logistics & industrial space. • Office: AI augments knowledge workers, increasing office usage across a range of industries and supporting higher-quality space. • Retail: Faster wage growth lifts consumer spending, supporting above-baseline retail rent growth, though tempered by increased online spending. • Property values: Stronger fundamentals and slightly lower rates support above- baseline appreciation over the forecast period.
• Retail: Slowing income growth and weaker
consumption pressure retail sales and space demand.
• Property values: Mixed productivity gains and weaker demand place
pressure on values, despite localised investment in AI infrastructure.
Source: Cushman & Wakefield Research Moody’s Analytics
Cushman & Wakefield
Powered by FlippingBook