Reimagining Real Estate: A Framework for the Future

Context and Origin of the Report

The insight report “Reimagining Real Estate: A Framework for the Future” is published by the World Economic Forum, a global authority that convenes leaders from business, government and civil society to shape international agendas. The research is authored by Christian Ulbrich, Global Chief Executive Officer and President of JLL and Industry Chair for Real Estate at the Forum, together with a broad coalition of academics, industry executives and policy experts from institutions such as New York University Stern School of Business, C.H. Chen Institute for Global Real Estate Finance and numerous multinational firms.

Four Pillars Guiding Sustainable Housing

The framework centres on four inter‑linked pillars – liveability, sustainability, resilience and affordability – that together define the vision for future housing across Europe. Liveability stresses human‑centred design, health‑focused indoor environments and mixed‑use neighbourhoods. Sustainability demands whole‑life carbon reduction, energy‑efficient retrofits and the adoption of green certifications. Resilience addresses the capacity of buildings and cities to absorb shocks, from climate extremes to economic turbulence. Affordability seeks to keep housing costs below 30 % of household income while expanding supply through higher density, flexible zoning and public‑private partnerships.

Key Quantitative Findings

• Global real estate assets were valued at US $379.7 trillion in 2022 – nearly four times world GDP and more than the combined value of equities (US $98.9 trillion) and debt securities (US $129.8 trillion).
• Buildings account for roughly 40 % of worldwide greenhouse‑gas emissions; only 1‑2 % of structures are renovated each year, underscoring a massive retrofitting gap.
• The report estimates that energy‑efficiency measures could deliver 10‑40 % savings in operating costs, depending on asset class, and that green‑building certifications are increasingly linked to rental premiums.
• In Europe, 76 % of cities remain highly vulnerable to climate‑related risks, while the construction sector faces an average cost inflation of 3.3 % in 2024.
• Public‑private partnerships are highlighted as essential, with the Forum noting that over US $1 trillion of infrastructure funding has been mobilised in the United States through the 2021 Infrastructure Investment and Jobs Act, a model that could be adapted for European cross‑border projects.

Technology and Data as Enablers

Advanced analytics, artificial intelligence and prop‑tech are presented as critical tools for measuring performance, optimising energy use and improving occupant wellbeing. The report cites examples such as AI‑driven energy management, digital twins for risk assessment and BIM‑based construction monitoring. Enhanced data transparency is portrayed as a catalyst for investor confidence and more efficient capital allocation.

Financing Mechanisms and Incentives

The authors advocate a diversified capital stack that blends traditional debt, equity and innovative instruments such as green bonds, land‑value capture and tax‑credit schemes. They stress the importance of low‑LTV ratios, robust reserve requirements and hedging tools to mitigate interest‑rate volatility. The Forum also recommends targeted public incentives – tax reductions, grants and subsidised credit – to accelerate affordable‑housing delivery and decarbonisation projects.

Policy Recommendations for European Leaders

Key actions include:

1. Standardising zoning and permitting processes to reduce bureaucracy and unlock higher‑density development.
2. Mandating transparent disclosures on energy performance and carbon footprints across the EU housing market.
3. Aligning fiscal policy with climate goals through carbon‑pricing mechanisms and incentives for low‑carbon retrofits.
4. Strengthening cross‑border collaboration on infrastructure, data standards and financing platforms to mobilise the scale of capital required for a sustainable housing transition.

Outlook and Call to Action

The report concludes that achieving the four‑pillar vision will require coordinated effort from public authorities, private investors, developers and occupants. While progress is evident in sectors such as high‑quality office spaces and data‑centre growth, many European markets still exhibit stagnation in affordable, energy‑efficient housing. The Forum urges stakeholders to adopt the outlined strategic levers promptly, noting that the pace of climate change and demographic shifts makes timely implementation essential for a resilient, inclusive and sustainable European built environment.