Global active capital remains discerning and methodical with investors targeting well-located, well-managed assets providing resilience, reliable returns and long-term market relevance, according to survey findings by Bayleys’ global real estate partner Knight Frank.
The Active Capital Survey in the Knight Frank report Noise, Nuance and Opportunity distils the views of 119 global investors with over US$1.4 trillion of assets under management and $144 billion of planned deployment in 2026.
The report is discussed in the latest edition of Bayleys’ Total Property, with the firm’s national director commercial and industrial and lead for its capital market arm, Ryan Johnson and director capital markets, Jason Seymour offering a New Zealand perspective.
The over-arching theme is that global investor sentiment is shifting from caution to conviction, and agility is emerging as a defining advantage with investors who can move quickly, structure creatively, and partner effectively more likely to secure early-cycle opportunities.
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Knight Frank’s head of capital markets research, Victoria Ormond says almost 90 percent of survey respondents plan to increase their investment in commercial real estate assets under management in 2026, but warns of potential imbalance in some markets between capital seeking deployment and stock availability.
“This will be heightened for prime assets in markets where liquidity, transparency and repricing have aligned. The challenge for investors this year will not be a shortage of capital, but how quickly and selectively it can be deployed before competition intensifies.”
In the Asia-Pacific region, lower debt costs and structural demand drivers are expected to lure investors to Japan, Singapore and Australia, with capital becoming more selective by prioritising markets where entry pricing is clearer and execution risk is lower, even if wider global macroeconomic uncertainty persists.
Ormond says well-located, ESG-compliant office assets are a target asset class, industrial and logistics remains a high-conviction sector, retail is seeing a measured resurgence, and the living sectors and alternative sectors such as healthcare, data centres and infrastructure are also gaining traction reflective of longer-term structural themes shaping diversified portfolio construction.
“Active capital is seeking balance rather than extremes,” she says, with planned deployment for 2026 split across Core, Core-Plus, Value-Add and Opportunistic strategies.
“Higher-risk strategies remain firmly on the agenda, but investors are demanding a clear premium for complexity, execution risk and repricing uncertainty.
“More than two-thirds of respondents also plan to consider joint ventures or capital partnerships in 2026, highlighting the importance of collaboration to access specialist expertise, diversify risk and secure larger or more complex opportunities.”
Speaking to the New Zealand market, Johnson says while there had been a dearth of transactions over $20 million since late-2021, activity picked up from September 2025.
Syndicators and property fund managers are back in the market, and global investors are seriously looking at our change in debt-to-yield spreads, enabling tax environment, and revised seismic stance and seeing real value here.
“It bodes well for us that the Knight Frank report identified Australia as a preferred market for active capital because pricing in New Zealand is often benchmarked against the eastern seaboard of Australia.
"As demand rises for commercial real estate assets in Melbourne and Sydney, and the debt-to-yield spread compresses, New Zealand will be the next cab off the rank.”
Johnson says capital partnering and joint venture considerations are coming to the fore as offshore parties identify pathways to execute strategic projects with identified earnings growth across all asset classes.
“Bayleys’ capital markets team can originate the pipeline, identify local partners, advise on capex and ESG opportunities, provide research and advisory services to assist key decision-making, co-market with Knight Frank, and bring Bayleys Property Services division onboard for post-deal performance and management.”
With global dry powder poised to re-engage as interest rates stabilise, New Zealand will need to demonstrate superior risk-adjusted outcomes and lower deal friction to compete, says Seymour.
"We need to signal certainty and speed and offer a yield/total return premium over Australia and other markets, along with presenting platform opportunities such as multi-asset or precinct assets with inherently low impediment to execution.
“With The Reserve Bank of New Zealand’s OCR tone moving to more of a ‘hold’ position unless data weakens, New Zealand could have more certainty over other markets for 2026–27 and this supports price discovery.”
- Supplied by Bayleys
