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Europe Real Estate CIO Spotlight: August 2026
1/7/2026
Dr Ulrich von Creytz
CIO Real Estate, Europe
The Evolution of Core: From “hold by default” to “sell by signal”
Earlier this year, I watched a decisive World Cup qualifying match together with my colleague Giuseppe Colombo, our Head of Real Estate in Italy. For Italian football, it was a painful evening. Another missed qualification, another disappointment for a nation whose footballing history is among the richest in the world.
There was no Schadenfreude in the room – only frustration and a sense of disbelief. A team that once stood at the very centre of global football, arguably even at its prime, is now struggling to keep up. The conclusion is uncomfortable but unavoidable: Italian football is no longer core. Cycles have turned, requirements have changed, and what once dominated now needs renewal. Recent World Cup events suggest that Germany may not be entirely immune to this reality either.
Real estate is not so different.
Very few assets remain core forever. “Core” is not a static label, but a phase within a lifecycle – and those lifecycles are becoming shorter.
Back to Giuseppe. As we continued our conversation, he pointed to one of the most illustrative assets in our own portfolio: an office building near Milan’s Duomo that we have held for around 25 years. The building has never been flawless from a technical perspective, but its location and intrinsic characteristics have consistently supported strong demand. It is precisely this combination – resilience, adaptability and continuous relevance – that has allowed the asset to remain core over such a long period. Yet examples like this are becoming increasingly rare.
Shorter lifecycles and rising capital intensity
In real estate, it is the rule rather than the exception that assets lose quality over time. User requirements evolve, regulatory pressures increase, technology advances and occupiers become more demanding. A property that qualifies as core today will, sooner or later, require reinvestment to stay competitive.
This is hardly a new insight; it is the basic arithmetic of our industry. What has changed, however, is the speed at which this happens.
My observation is that property lifecycles are currently shortening across most sectors. Office real estate is a particularly telling example. We increasingly see higher tenant improvement costs, sometimes already triggered by a lease extension after ten years. Assets that once generated stable performance with limited intervention now require substantial capital expenditure much earlier in their lives.
Without timely reinvestment, perceived quality deteriorates rapidly – and withit rental potential, tenant demand and liquidity. What started as a core asset gradually turns into a repositioning case. Not because something went wrong, but because the environment around the asset moved on…