The commercial real estate sector is showing early signs of recovery, evoking the cautious optimism of 2010–2012 after the Great Financial Crisis. This time, however, recovery depends not just on patient capital but on operational discipline and strategic use of technology.
Mandi Wedin, founder and CEO of Feroce Real Estate Advisors, has spent two decades managing institutional real estate portfolios across office, multifamily, retail, and industrial sectors. Her firm now specializes in helping companies strengthen their investment, operational, and technology strategies to build lasting value.
“Right now the market feels like the early post-GFC recovery,” Wedin says. “We’re seeing the early ripples of a recovery wave where capital is cautiously coming back into real estate—specific markets, specific asset classes that have strong fundamentals and can be resilient while we’re going through this extended recovery.”
Selective Return of Capital
Current market data points to a selective return of capital. Transaction volumes show that investors are targeting specific properties and sectors rather than re-entering the market broadly. Foreclosure auctions, in particular, offer insight into investor sentiment.
“An interesting item I look for regularly is whether the foreclosure auction is at the note price, or if there’s actually competition and it goes above the note,” Wedin explains. “There have been a couple in the last few weeks where the asset sold for more than the note. When people are willing to pay more than the note, they see opportunity, and they’re going to put their money where their mouth is to execute on it.”
This targeted investment activity signals the start of a market reset. Many properties remain distressed, requiring recapitalization before they can generate returns. A major challenge is the prevalence of “upside down capital stacks,” where investors, owners, operators, and lenders all face losses.
Working Through Distress
Resolving these distressed situations is critical for market recovery, though the process is often painful. “You have to go through the pain of somebody no longer owning that asset, and most likely not making money on it, losing money on it, losing their investors’ money on it, which is bad news. But you have to go through the pain of that process to get to the other side,” Wedin says.
Not every distressed asset will go through foreclosure. Some can be salvaged through workouts if there is a clear repositioning plan. However, certain property types—such as aging Class B office buildings that require expensive upgrades—face particularly tough prospects in the current environment.
Operational Execution as the New Differentiator
In this context, operational excellence is emerging as the main source of competitive advantage. “It’s not just the buy, it’s the execution,” Wedin emphasizes. “The asset selection is important, but it’s also the asset management execution of the plan. For the most part, it’s not buying stabilized, leased, cash-flowing projects—it’s buying something that takes work.”
This marks a shift from the previous era, when acquiring well-located properties was often enough to ensure returns. Today, success depends on the ability to improve underperforming assets and manage risk effectively.
Technology as a Core Component
Technology has moved from being a nice-to-have to an essential part of real estate operations. Wedin’s approach is to focus on practical, targeted uses of technology that solve real business problems.
“AI is not a strategy. AI is a tool that supports your strategy execution,” she notes. “We look for targeted, tangible applications. We’re not looking for the big solve-it-all solution to transform the business. We’re looking for critical business pain points—problems that actually need to be solved.”
Automation is especially valuable in reporting and data collection. “Where do humans spend time just moving data within your team? That is where you attack a problem,” Wedin says. The goal is to provide actionable insights, not just generate spreadsheets full of numbers.
Effective technology deployment, however, depends on three main factors: clean data, defined objectives, and strong human oversight. “When we do that, AI actually moves the needle on performance. It’s not just a fun or frustrating thing—it can move the needle, but it takes some work to get there.”
The Data Hurdle
For many real estate companies, the biggest obstacle to technology adoption is organizing and standardizing their data. Historical information is often scattered across spreadsheets, PDFs, committee memos, hard copies, and email archives.
“That collection of data and cleaning and storage of data is sort of the medicine that we have to take to get to the outcome,” Wedin acknowledges. While this is a capital expense that does not generate immediate revenue, it is now essential for staying competitive.
The payoff is clear: companies that can access and analyze their data gain a performance edge. “You have a competitive advantage when you can see data in context, and those who don’t have it will struggle to compete,” she explains. “Asset management professionals aren’t going to be wholesale replaced by AI or bots, but they will be replaced by asset management professionals who are using AI tools.”
Resilience as a Core Requirement
Alongside operational and technological improvements, resilience has become a non-negotiable investment criterion. This includes environmental, social, governance, and risk management frameworks, as well as operational flexibility.
“Investors, regulators, customers—your tenants—they want real evidence today that real estate companies can manage the risks that are out there,” Wedin says. This means demonstrating the ability to handle extreme weather, ensure energy reliability, and adapt to changing tenant needs.
Stakeholders now expect concrete proof of risk management, not just promises or plans.
Demographic Trends Shaping Demand
Several demographic shifts are changing the landscape for commercial real estate. The aging workforce affects both the talent pool and the user base for office properties. Urban and suburban migration patterns are also evolving, and tenant preferences are influencing what buildings must offer to stay competitive.
“What the demand for a building is today, what it needs to do to satisfy its stakeholders—that’s changing, and we’re working to keep up with it and build a product that can manage through those shifts,” Wedin says.
A Playbook for Recovery
Wedin’s framework for navigating the current environment centers on three priorities: identifying specific operational pain points, implementing targeted solutions (with or without technology), and maintaining focus on measurable results.
The companies poised to thrive are those that can execute operationally while adapting to changing market conditions. This requires building strengths in data-driven decision-making, risk management, and organizational flexibility.
As capital begins to flow into select markets and asset classes, the firms that have invested in operational and technological improvements will have a clear advantage. The early stages of recovery are here, but future success will depend on preparation, rigorous execution, and the ability to adapt quickly.
