A higher-for-longer interest rate environment has created an opening for private real estate debt, according to Savills Investment Management (Savills IM). The firm points to a combination of repriced property values, higher coupons and a refinancing wall as conditions that are attractive for new lenders, particularly as many owners face maturities after a period of higher borrowing costs.

Private credit has been among the top picks for alternative investors over the past few years, noted Cyrus Korat, co-founding partner of DRC Savills Investment Management. During the period of high interest rates, corporate lending generated higher-than-expected returns alongside rising corporate profits.

Japan resilient despite BOJ's tightening bias

Japan's real estate market has remained resilient despite the central bank's interest rate increases and tightening bias, Savills IM said, as predicted rental growth, together with stable and predictable cash flow, can compensate for lower yields. That combination helps explain why income-oriented assets continue to draw attention even in a tighter policy setting.

Global real estate market poised for strong rebound

The global real estate market is expected to pick up significantly over the next few years, according to Savills, with around $500 billion worth of real estate assets held by still-undivested closed-ended equity funds likely to hit the market. That pipeline could give investors more opportunities to reassess pricing and transaction volumes as capital markets normalize.

European student housing is top of the class

The appeal of European purpose-built student accommodation (PBSA) to real estate investors is growing rapidly, said Hamish Smith, head of research and strategy (UK) at Savills Investment Management. In the recent 2025 INREV Investor Intentions survey, student accommodation ranked third, underscoring continued demand for sectors with visible occupancy and rental demand.

Savills mandates in the Korean market

The commentary from the Savills organizations comes alongside recent sale mandates in the Korean commercial property market.

Savills Korea has been appointed as the sale manager of four office buildings owned by AmorePacific Corp., a mandate that marks one of the cosmetics group's most significant non-core asset divestments in Korean provincial markets, according to Savills.

Separately, JLL and Savills have been tapped to lead the sale of Seoul Square, a landmark office tower located directly opposite Seoul Station and valued at around 1.4 trillion won ($1 billion), adding to a growing pipeline of prime assets coming to market in Seoul.