AI wave could spill into real estate with ample upside ahead: Nuveen

Global investment manager Nuveen said Wednesday that the artificial intelligence (AI) boom is expected to extend its impact to the real estate sector, emphasizing that there remains significant room for investment.

“It’s useful to reflect on the success of the 'Magnificent 7' in the stock market,” Abigail Dean, global head of strategic insights for Nuveen Real Assets, told reporters at a press meeting held at the Conrad Seoul, Wednesday.

“I think that those innovation and productivity gains have not yet been seen in real assets, but something that will be set to take advantage of in the coming years,” she added.

The rising influence of AI is driving demand for digital infrastructure such as data centers and the energy systems that support them, drawing attention to sectors closely tied to these trends.

Chad Phillips, global head of Nuveen Real Estate, noted that private real estate is currently “underallocated” in total investor portfolios due to a global market correction.

As of June 2025, private real estate accounted for just 7.6 percent of total investor portfolios. In comparison, the asset class made up 10 percent and 13.7 percent of portfolios in 2021 and 2022, respectively.

Real estate investment is becoming increasingly attractive amid improving market conditions. “We’re really just starting to see that recovery. My view is that you need to have sort of a three-to-seven-year time horizon,” Phillips said.

He added that restrictive immigration policies implemented during the Trump administration have tightened the U.S. construction labor supply, making new developments harder to initiate. As new supply is expected to remain very limited over the next few years, there is also a room for rental growth.

Regarding the Korean market, Nuveen stated that it has been actively investing in the country and plans to further expand its presence.

The firm opened its Seoul office in 2021 and currently serves institutional clients, with a focus on real estate and infrastructure investments. It is also expanding its domestic portfolio to renewable energy sectors such as solar and offshore wind power.

Nuveen is a subsidiary of the Teachers Insurance and Annuity Association of America, one of the world’s largest institutional investors. It manages assets worth approximately $1.3 trillion.