The 4Ds shaping the future of real assets

What are the structural forces driving the real assets market?

We believe that the global investment landscape is being shaped by four enduring trends: deficits, deglobalization, decarbonization, and demographics. These ‘4Ds’ point to a positive long-term outlook for real assets (real estate and infrastructure).

Driven by the need to modernize infrastructure, support defense capabilities, and accelerate energy transition projects, many governments are running growing deficits. This fiscal expansion boosts demand for real assets, while also reinforcing their role as long-term inflation hedges.

Deglobalization is another defining force. The COVID-19 pandemic and geopolitical tensions have prompted many nations to near-shore production, diversify supply chains, and enhance domestic capabilities to improve resilience and energy independence.

At the same time, the decarbonization push is reshaping real asset investment opportunities, particularly in infrastructure. It is estimated that $94tn will be needed in infrastructure financing by 2040 to keep pace with growth and development requirements enabling the energy transition.

Finally, changes in demographics are driving demand in certain types of real estate. For instance, there is a need for healthcare-related properties to support aging populations. Meanwhile, urbanization has impacted buying and renting behavior for residential properties.

What opportunities do the 4Ds give investors?

The 4Ds are redefining how investors allocate their assets, and are the tailwinds for growth in some emerging sectors.

One example is logistics and warehouses. As deglobalization and decarbonization initiatives take hold, there is a growing demand for smaller, strategically located warehouses near city centers to support last-mile delivery and domestic supply chains. This is especially the case in densely populated areas, like Germany and France, which are the heart of major transport routes and have a large amount of logistics assets.

Another example is life sciences. Purpose-built laboratories and research facilities are in high demand due to demographic shifts and advances in healthcare. There is potential for value creation for investors from identifying, adapting, and managing assets to facilitate operations in this industry.

What do asset managers need to capture these opportunities effectively?

Agility and focus are becoming key differentiators among managers. In a capital-constrained environment where exits are limited, institutional investors are increasingly selective about the managers they back. Those able to identify and execute early on emerging trends will stand out.

Mid-sized managers, like Edmond de Rothschild, who have deep market knowledge and local presence are well placed. Having teams on the ground enables faster execution, closer tenant engagement, and better oversight of regulatory developments.

Investors who align their strategies with the 4Ds and partner with managers who can adapt quickly to evolving market conditions and execute early on emerging trends will be in a good position to capture the long-term return potential of real assets.

About
Edmond de Rothschild Asset Management has been serving institutional, distribution, and intermediary clients for several decades, managing today €110bn across all major asset classes.

Christophe Caspar joined Edmond de Rothschild in 2018, and was appointed Head of Asset Management in 2019. Prior to that, Christophe was Head of Investments at Pictet Wealth Management and executive Board member. From 1999 to 2016, he held various positions at Russell Investments, including CIO for the APAC markets and Global CIO Multi-asset Solutions. Christophe is a CFA Charterholder and holds post graduate degrees from ESC Reims and Royal Holloway University of London.

This article originally appeared in Real Estate in 2026.

_{This is a sponsored opinion by Edmond de Rothschild. The views expressed are provided as of December 2025, do not constitute an endorsement, recommendation, or any other advice, and are subject to change. The content does not necessarily reflect the views of BlackRock, Preqin, or any of its affiliates. Edmond de Rothschild is not affiliated with Preqin. Preqin received compensation from Edmond de Rothschild in exchange for publishing this content.}