We all share a sense that the world we live in at the moment is an uncertain one.

Take the prediction from the experts at Absolute Strategy Research, that there is a 45 per cent chance of a global recession in the next 12 months.

Or, the projections from the US National Academy of Sciences that suggest that we might see sea level rises of 2 metres by 2100, potentially displacing hundreds of millions of people. Or, Pew’s projections that the global population will rapidly grow to a staggering 10.9 billion by 2100.

These are just a sample of the kinds of predictions that are currently being made about the future of the world we live in. Many of them are, by turns, both exciting and alarming.

And they offer different threats and opportunities for all of us. Throw the game-changing impact of technologies like AI into the mix, and we have a future that is easy to speculate about, but very hard to predict.

So, with that in mind, I wanted to talk here about just a few of the ways that we can, as investors, try to future-proof our real estate investments. Here are a few thoughts.

  1. Don’t try to future-proof your investments

Bear with me here. While this statement might seem to contradict everything else I’m about to say in the rest of this post, it is just to make the point that any investment, any portfolio, has to contain an element of risk. Risk is the secret sauce that ultimately helps to give you the edge as an investor.

The amount of risk you are willing to take on is up to you, of course. But following a risk-free real estate investment strategy is neither desirable nor realistic in the long-term.

So, when I talk about ‘future-proofing’ your portfolio of investments, I don’t mean removing risk from it altogether. Rather, it is about finding ways to balance the amount of risk you’re happy with, against the kinds of returns you want to see as you move into an uncertain future.

  1. Always think long-term

As a real estate investor, there’s a good chance you’re doing this already. Unless you’re a dedicated ‘fixer and flipper’, you’re probably looking at holding onto your real estate investments over a period of years, rather than months.

And this is very much to your advantage. Generally, upward inflationary trends alone will help you to add value to your properties through appreciation. As living costs rise, your rents will too. As we see an increased pressure on supply thanks to population growth and shifting demographics, there are plenty of reasons for real estate investors to see the long-term picture positively.

But taking the long-term view is also important in that it mirrors the arc of many of the changes we’re likely to see happening in the world. Climate change, population growth, political uncertainty and economic ups and downs are all cycles that occur over tens of years, rather than in the short term.

The lesson here is to always look at the big picture, and don’t rush to judgement on the basis of limited, short-term data.

  1. Follow the smart money

Sound advice for any investor, of course. But what does this actually mean for real estate investors?

Well, many of the risks that we see potentially having an impact on real estate are societal and environmental. These global concerns are driving many of the key trends we’re now seeing right across business.

For example, customers want to do business only with companies that share their values. They want to buy products that have been sourced fairly, with minimum impact on the environment. And increasingly, they want the properties they own or rent to be smarter: not least in terms of energy and efficiency. For us as investors, it all adds up to a simple path to a more sustainable investment strategy.

For example, as investors, we need to understand how property technology (‘proptech’) can impact the value we get from the buildings we own. I’ve spoken here before about the transformative and disruptive impact that tech is increasingly going to have on our industry.

We need to take advantage of every new tool we have at our disposal, to monitor and manage everything from energy use to bespoke rental rates. Energy efficient construction, affordable homes and developments that take into account their impact on the environment will all become increasingly desirable.So, by investing in smarter buildings, and by being smarter about how we then manage those investments, we can take a big step towards securing any future returns.

Again, it’s not about reducing or eliminating any risk. Risk is what generates returns, after all. But there are ways, even in this unpredictable world, that we can use that unpredictability to our advantage as investors.