As real estate investors recalibrate for a new cycle, capital is rotating away from overcrowded Sunbelt markets and back toward complex urban projects, select global opportunities, and industrial assets with durable demand drivers.  

Peter Ciganik, Partner and Head of Capital Markets at GTIS Partners, shares where his $4.9 billion platform is finding opportunity today, from large-scale mixed-use developments in gateway cities to industrial and residential investments in Brazil, while also unpacking the impact of falling mortgage rates and evolving Trump-era policy dynamics on real estate markets. 

CM: You’ve described the market as entering a new real estate cycle. What signals are you watching most closely to support that view? 

PC: One of the clearest signals is the stabilization and rebounding of transaction activity after several years of volatility. Per MSCI, CRE deal volume (in $ terms) was up 23% for 2025, while Colliers projects transactions to rise 15-20% this year. Recent industry outlooks point to pricing stabilization, improving investor confidence, and increasing deal volumes, particularly as capital markets begin to normalize and financing conditions ease relative to the tightening seen in 2022–24.  

Additionally, sentiment surveys show that while caution persists, a significant share of CRE professionals expect deal activity to hold steady or improve, indicating a gradual shift from contraction toward selective growth. 

CM: How has investor risk appetite changed coming out of 2025, and how is that influencing GTIS’s deployment strategy? 

PC: Investor risk appetite is more measured and differentiated across sectors. Many investors are still staying on the sidelines or adopting a cautious stance, with concern from factors such as high financing costs, trade policy uncertainty, and uneven sector fundamentals. At the same time, GTIS has identified investment opportunities in key gateway markets with strong residential demand from deep employment bases, limited or reduced supply, desirable lifestyle amenities, and investment liquidity.  

We are seeing interesting opportunities in the apartment sector in San Francisco and New York, where employment has been strong and supply has always been constrained. At the same time, Sunbelt markets that were oversupplied have opportunities to invest below replacement cost or provide rescue capital for projects that were over-levered or need additional capital infusion to complete and lease.  

CM: Why are large-scale, infrastructure-adjacent urban projects becoming more attractive right now?  

PC: Investors and occupiers alike are placing greater emphasis on locations with strong transportation access, proximity to labor pools, and connectivity to broader logistics networks, which support both urban living and hybrid work models. Resilient demand and absorption run up against long-term structural housing shortages and severe supply constraints in markets such as New York and San Francisco.  

Despite these resilient fundamentals, gateway assets are trading at cap rates comparable to those in lower-barrier markets, allowing investors to buy higher and more consistent growth at similar yields. In addition, infrastructure-adjacent development often ties into broader public and private investment flows, including urban revitalization and mixed-use transformation, which can unlock incremental value and reduce vacancy risk. 

CM: Many investors still favor the Sun Belt, yet you’ve flagged overbuilding risks. Where has supply growth most distorted returns?  

PC: While the Sun Belt has been a favorite destination due to strong population growth and job creation, supply growth has outpaced demand in some segments, particularly in secondary, speculative industrial and multifamily submarkets. In markets such as Phoenix, Austin and others, multifamily fundamentals have shown localized oversupply conditions as a large wave of new high-end projects has come online in the post-pandemic years. These dynamics illustrate that rapid development without commensurate tenant demand can distort returns, especially in markets with high construction costs and tight financing.  

As a result, investors are focusing on fundamentals and pipeline discipline, avoiding over-saturated submarkets within the Sun Belt where supply growth has outpaced underlying economic demand. 

CM: You’re seeing renewed condo activity in San Francisco and New York. What’s driving the comeback in these markets? 

PC: Condo activity in San Francisco and New York is experiencing a resurgence driven by several demand-side and sentiment factors. After years of pandemic-related weakness, these markets have seen improving fundamentals, including employment growth, return-to-office trends, and a rebounding urban lifestyle preference. Moreover, urban cores are benefiting from hybrid work and lifestyle demand, which are translating into renewed interest in ownership within dense, amenity-rich neighborhoods.  

This combination of improving economic fundamentals, lifestyle preferences, and capital availability is stimulating condo market activity as well as high-end rentals. In New York, in particular, these dynamics have created potential in for-sale and for-rent residential development projects featuring strong development margins and opportunistic return profiles. 

CM: With inventory still tight, does lower financing cost actually unlock deals, or simply reprice existing assets?  

PC: To begin, lower financing costs can both unlock new deals and reprice existing assets, depending on the asset class and risk profile. As refinance risk eases, owners can deploy capital into acquisitions that were previously unfeasible, effectively unlocking deals that were on hold due to restrictive credit conditions. However, because cap rates and asset pricing are closely linked to the cost of capital, lower financing costs also lead to higher valuations for stabilized assets, contributing to repricing pressure in competitive sectors. This dynamic often results in bid-ask compression and repricing even as transaction volumes increase. Thus, lower financing costs can meaningfully expand the investable opportunity set while simultaneously increasing pricing competition, particularly for core assets with predictable cash flows. 

CM: If you had to prioritize one theme investors may be underestimating in 2026, what would it be and why? 

PC: One theme investors may be underestimating is the Opportunity Zone (OZ) program, particularly given its approaching statutory deadline and growing evidence of real economic impact. OZs were designated as part of the 2017 tax legislation to spur long-term private investment in designated low-income communities by offering capital gains tax incentives to support economic development, job creation, and community revitalization. While the program is only about five years old, research suggests it has been effective in channeling capital into underserved communities. A study by the Economic Innovation Group found that the OZ incentive is reaching more low-income communities and unlocking more investment capital than predecessor place-based programs at comparable stages. 

From an investment standpoint, OZs have already driven substantial housing development. Novogradac estimates that more than 80% of Qualified Opportunity Fund (QOF) capital has gone into residential projects, financing nearly 200,000 housing units across more than 230 U.S. cities, with the true figure likely several times higher once proprietary and private funds are included. In a market facing a persistent affordable housing shortage, that scale matters. 

The One Big Beautiful Bill Act (OBBBA) enacted in July 2025 created permanence for the OZ incentive and paved the way for the next round of census tract designations under ‘OZ 2.0 version’ of the program. Investors are just now starting to appreciate the potential for Opportunity Zones and we would expect a surge of capital seeking to capture these incentives.