Federated Hermes’ 2026 private markets outlook highlights continued shifts across real estate debt and infrastructure as cyclical and structural forces reshape investment conditions. In real estate, recent price corrections have coincided with resilient occupier markets, while hybrid working, rising construction costs and rapid technological change create uneven demand across office and other property sectors.
Real estate debt remains attractive for its resilience, diversification benefits and ability to generate returns even when underlying assets face pressure, though careful underwriting and diversified tenant exposure remain important. In infrastructure, geopolitical fragmentation and the push for national sovereignty are driving renewed focus on onshoring in energy, data and defense, underscoring electrification and renewable power as central investment themes. In the United Kingdom, inflation, interest rates and gilt yields sit within historic norms, but high national
