After two years of rapid repricing, tighter lending and thin transaction pipelines, parts of the commercial real estate market are starting to stabilize, creating what some see as an attractive entry point for long-term capital.  

Chad Phillips, Global Head of Real Estate at Nuveen, which oversees $141 billion in real estate assets, believes the recent vintages could prove compelling as financing conditions gradually normalize and deal activity improves. Phillips discusses where Nuveen is leaning in across sectors such as necessity-based retail and senior housing, how the firm is thinking about risk and capital structure in the current environment, and what diversified investors should consider as they recalibrate allocations.  

CM: You’ve suggested the past couple of years may turn out to be attractive vintage years for real estate portfolios. What makes this period different from past cycles? 

CP: Real estate turned the corner in 2025, and we expect the recovery to continue building momentum in 2026, driven by an upswing in values, a falloff in new supply, and increasing deal velocity. Further, the pullback in construction activity bodes particularly well for occupancy and rent gains over the medium term, further benefiting the asset class.  

Within the current environment, we believe there should be a focus on necessity real estate with more resilient, demographically driven demand drivers. While unexpected challenges could arise given the uncertain geopolitical and economic backdrop, this is not new — and importantly, real estate has been substantially de-risked as an asset class following the value correction experienced between 2022 and 2024.  

CM: How meaningful has the repricing been across core, core-plus, and value-add strategies? 

CP: Global real estate values have been consistently nudging higher since the end of 2024 following a peak-to-trough reset of 16.2%, with pricing now below 2019 levels — marking what we believe is an attractive entry point for investors. The repricing has been broad-based across regions, with most European countries now beginning to show meaningful value increases. In Asia Pacific, Australia has stabilized while Japan and Korea continue to moderate, and in the Americas, U.S. values are trending upward while Canada remains in adjustment. Taken together, this global repricing has created compelling opportunities across core, core-plus, and value-add strategies for investors looking to reenter or expand their real estate allocations. 

CM: As lending conditions begin to normalize, what are you seeing in terms of deal terms, leverage levels and the depth of lender appetite compared with 18–24 months ago? 

CP: Lending conditions have normalized meaningfully, with strong liquidity across all lender types — banks, alternative lenders, agency, and CMBS — driving compressed spreads across asset types and risk profiles, with leverage levels returning to normal as lenders grow increasingly comfortable with reset values.  

On core profiles, tightest spreads for multifamily, grocery-anchored retail, and industrial are in the low 100s at 120–135 basis points, with grocery-anchored retail pricing tighter than industrial in many instances due to strong lender conviction and under allocation in that space. Bridge profiles are seeing tightest spreads in the low 200s at 215–230 basis points, while construction financing sits in the low-to-mid 200s.  

With investor appetite in the credit space running high and liquidity increasing, borrowers are also finding themselves better positioned to negotiate more favorable terms around structure and covenants. 

CM: Where do you see the greatest refinancing risk in the market today, and how does that translate into opportunity—or caution—for a global manager like Nuveen? 

CP: With over a trillion dollars in loans maturing in the U.S. between 2026 and 2028, and comparable volumes across Europe and Asia Pacific, refinancing risk is substantial. Only 21% of borrowers intend to fully repay at maturity, yet just 14% of the approximately $400 billion in global real estate dry powder has been allocated to debt strategies — pointing to a meaningful gap between borrower demand and lender supply.  

For Nuveen, this presents a compelling opportunity, as recovering capital values de-risk loans over time and elevated margins offer an attractive entry point ahead of increased lender competition. With banks refocused on prime senior lending, the non-prime market remains more balanced, creating attractive openings for non-bank lenders able to operate flexibly across the capital stack. 

CM: Retail has “gone through meaningful repricing over the last cycle.” What must happen for investors to regain conviction in the sector at scale? 

CP: We maintain high conviction in necessity retail, which we believe is poised to outperform given resilient fundamentals and enduring consumer demand for essential goods, convenience, and local services — trends reinforced by hybrid work and post-pandemic behavioral shifts.  

Our global research identifies three hallmarks of successful necessity retail investments: strategic locations in demographically favorable areas, best-in-class tenants, and sustainable traffic driven by market dominance. A clear performance gap has emerged across the sector, with Class A and grocery-anchored properties demonstrating defensive characteristics while lower-rated assets struggle. With construction activity at historic lows buffering occupancy rates and leasing increasingly led by service-based tenants, investors looking to regain conviction in retail should focus on quality, relevance, and the durable demand drivers that necessity retail continues to offer. 

CM: You’ve pointed to a “supply-demand imbalance” in senior housing driven by aging demographics and limited new construction. How acute is that imbalance in your key markets? 

CP: The supply-demand imbalance in senior housing is well-supported by the data. In primary markets, demand has outpaced new supply for 18 consecutive quarters, pushing occupancy above pre-COVID levels. Further, decelerating supply growth, combined with record-high demand driven by aging demographics, has produced meaningfully improving fundamentals across the sector. As a result, senior housing RevPAF growth — combined measurement of rent and occupancy growth — is projected to outperform traditional property types, including retail, apartments, industrial, and office, over the next five years.  

CM: Looking back a few years from now, what do you think will define the best-performing real estate vintages of this period—and what will have separated successful allocators from the rest?  

CP: Looking back, we believe the best-performing vintages of this period will be defined by disciplined asset selection and active asset management, with two catalysts emerging as key differentiators: artificial intelligence and the energy transition. AI is transforming property operations through building automation, enhanced tenant experiences, and data center demand, driving compressed costs and more predictable NOI.  

Meanwhile, the energy transition is fueling strong occupier demand for green buildings, particularly in Europe where rental premiums of 5–10% are being realized. These innovations are no longer simply operational improvements; they are frontline drivers of value that will ultimately separate successful allocators from the rest.