AI IMPACT Baseline scenario: Commercial real estate
1 AI is additive to demand, not a substitute for space AI adds modestly to growth across sectors, with cumulative space demand ending the decade a little higher than the pre-AI trend implied. The effect builds slowly and is preceded by a period of recalibration. 5 Logistics & Industrial evolves gradually, but requirements rise Traditional demand remains intact, while automation, power needs, and advanced logistics drive demand for modern, flexible facilities over time.
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Job displacement is real, but net job creation dominates AI eliminates routine roles, but most jobs evolve rather than disappear, with new businesses and higher-value work driving net employment growth.
Office demand is reshaped, not reduced Office space demand remains strong but the composition of demand changes over time as the nature of office-using employment evolves.
AI increases office bifurcation and the premium on flexibility AI accentuates the shift in demand toward high-quality, well-located, and adaptable space, as offices evolve from desks to collaboration, decision-making, and client engagement.
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Retail benefits from AI, but becomes more polarised Stronger income growth supports spending, but a K- shaped consumer drives outperformance at the high and low ends, with pressure on mid-tier retail.
Location matters more across all sectors AI exposure varies across capital cities, widening performance gaps across geographies and assets.
Experiential and location-driven retail lead Physical, experience-based retail remains resilient, with demand concentrating in capital cities.
Cushman & Wakefield
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