As the new year begins, the commercial real estate (CRE) industry is no longer treating “Peak 65” as a distant demographic concern. That moment has arrived. A significant share of senior leadership is nearing retirement, and the resulting transition is already reshaping hiring strategies, succession planning, and long-term organizational design across CRE platforms.
According to a 2025 Deloitte report, nearly 60 percent of real estate industry leaders are expected to retire by the end of 2027. What was once a slow-moving issue has become a near-term operational challenge—particularly for firms navigating tighter capital markets, elevated execution risk, and increasing specialization.
A Market That Can’t Absorb Leadership Gaps
This generational shift is unfolding at a difficult point in the cycle. Banks continue to pull back from CRE lending, even as roughly $1.3 trillion in loans approach maturity and require refinancing across the market. At the same time, operational complexity across asset classes is intensifying.
Against that backdrop, the supply of experienced specialists—particularly in equity, credit and capital markets—remains constrained. This pressure is intensifying across CRE platforms, raising the bar for leadership experience at precisely the moment succession risk is increasing.
Kent Elliott, Principal at RETS Associates, frames the challenge succinctly: “The vast majority of the clients that come to us want specialists. They’re not looking for a generalist who is going to have a one-year learning curve. Our clients are looking for candidates with a track record specific to the niche in which they’re looking to execute.”
That emphasis on specialization raises the stakes of succession planning. Replacing long-tenured leaders is no longer a straightforward backfill; it is a strategic decision with lasting implications for performance, risk management, and capital execution.
As Peak 65 transitions accelerate, several clear lessons are emerging:
First, timing is critical—and narrow.
Many firms wait too long, reacting only after an unexpected departure. Others move prematurely, creating unnecessary overlap or internal disruption. The most effective succession plans typically begin 6 to 12 months ahead of a planned transition, depending on the role. This window allows for meaningful knowledge transfer without slowing execution or inflating costs.
Second, legacy roles often require recalibration.
Executives who have served for decades frequently accumulate responsibilities organically over time. Succession planning forces firms to reassess what the role truly requires going forward. In many cases, the right answer is not replication, but simplification—clarifying priorities, decision rights, and expectations in line with today’s operating environment.
And lastly, familiarity should not outweigh performance.
These are high-impact hires, yet many organizations default to internal candidates or personal networks. The strongest outcomes come from widening the lens and prioritizing qualification over comfort—even when that means looking beyond familiar circles.
The Leadership Middle: Gen X and Older Millennials
Much of today’s succession activity is centered on older Millennials and younger Gen X professionals—leaders who combine institutional knowledge with fluency in evolving capital strategies, including private credit, restructurings, and distressed investing. They also expect clearly defined mandates and authority, rather than inherited ambiguity.
“There needs to be some overlap so that the intellectual capital can be passed on, with a minimum of three to six months for this to work effectively,” Elliott adds.
That overlap is not inefficiency. It is protection—particularly in a volatile market cycle, where continuity of judgment and institutional knowledge can mitigate the risk of unexpected departures.
Looking Ahead
The firms navigating Peak 65 most effectively are treating succession as a repeatable process, not a one-time event. They are stress-testing leadership roles, building talent pipelines early, and aligning leadership decisions with long-term capital strategies.
As 2026 begins, the question is no longer whether succession planning is necessary. The real question is whether firms are prepared to execute it with clarity, discipline, and foresight.
