I believe that real estate should be central to that conversation. Property offers income, diversification, inflation sensitivity and a direct link to productive assets, from workplaces and logistics to housing, healthcare and urban infrastructure.

Yet Irish pension capital still appears underrepresented in real estate and other private markets. This is not a reflection of a weak investment case. International investors continue to allocate capital to Irish property because they see depth, liquidity and strong occupier covenants offering long-term potential. Indeed, more than half of annual commercial investment now emanates from non-Irish buyers. The question, therefore, is not whether the opportunity exists, but whether Irish pension investors have the right structures to access the sector efficiently and at scale.

Ireland is not alone in considering this question. Australian superannuation funds have long allocated meaningfully to property and infrastructure, while the UK’s Mansion House Accord has encouraged defined contribution providers to direct more capital towards private markets and productive finance.

The barrier is largely structural. Defined contribution schemes and Master Trusts can face challenges around scale, governance, liquidity and access. If the route to investment is complex, expensive or operationally difficult, capital simply will not flow, even where the underlying investment opportunity is compelling. This is why the debate should focus less on whether pension capital should be forced into domestic assets and more on how to create investable structures that allow suitable allocations to be made where they are in members’ long-term interests.

The introduction of auto-enrolment should make this issue more important over time, as it will increase the pool of long-term pension savings that need to be invested productively and with suitable access to real assets.

Pension funds are precisely the kind of investors that should be able to look through real estate cycles

We know that by its nature, real estate is cyclical, and recent years have reminded investors that valuations can move sharply when interest rates rise. But pension funds are precisely the kind of investors that should be able to look through cycles. Over time, good real estate can generate resilient income and create value through leasing, refurbishment, sustainability investment, development and active asset management. Long-term return expectations still matter: a sensible underwriting range for core Irish commercial real estate would be around 5% to 7% per annum on an unlevered basis, with higher returns possible where managers can add value. Residential market evidence also points to a positive long-term relationship between house price growth and inflation, with a real return of 3% per annum achieved historically.

The case is not just about return. Income has historically been a significant component of total property performance, which is particularly relevant for long-term pension investors. Rents can also adjust over time while the coupon on a conventional bond remains fixed, making property a useful inflation-sensitive asset where lease structures, occupier demand and asset quality support rental growth.

There is also a diversification argument. Irish real estate is influenced by common European macro factors, particularly interest rates, credit conditions and investor sentiment. However, domestic property performance can diverge meaningfully because supply pipelines, demographics, economic growth, leasing conventions and sector mix differ by country. For Irish pension funds, a domestic allocation does not simply duplicate wider European property exposure. It provides exposure to Ireland’s labour market, demographic trends, constrained supply, international occupier base and Dublin’s position as a European business hub.

Timing is also important. Commercial real estate values have been through a material repricing cycle and are now showing signs of stabilisation. In many cases, expected returns are again priced at a premium to the risk-free rate. Short-term performance will still be influenced by macroeconomic conditions, market cycles and geopolitical uncertainty, but for long-horizon investors, the current entry point creates an opportunity to secure income-backed returns while positioning for recovery as market conditions normalise.

Liquidity is another consideration. Property is less liquid than some other alternatives, but it is not illiquid. It does not trade daily, but that does not make it unsuitable for pension portfolios. The more useful question is whether a well-diversified pension strategy can accommodate an appropriate allocation to less liquid assets where the risk is properly understood, priced and governed. For long-term savers, there is a strong case that it can.

This is where the Irish Association of Pension Funds’ proposed long-term investment framework is important. An ELTIF-style vehicle could provide a practical route for pension and other long-duration capital to invest in diversified productive assets, including real estate. Such a structure would better align investor liquidity with the liquidity of the underlying assets and could provide the governance, scale and diversification that many schemes currently lack.

Greater domestic pension investment in real estate creates additionality – supporting the delivery of better workplaces, housing, logistics infrastructure, sustainable buildings and urban regeneration. The investment discipline must of course always come first, but there is a clear alignment between long-term pension outcomes and the national need for productive, well-managed capital.

The opportunity is not to push pension funds into Irish real estate at any price or to encourage narrow home bias. It is to remove the barriers that prevent long-term capital from accessing suitable investments. For investors and policymakers, the message is practical. For pension funds with long-dated obligations, property should have its place in a well-diversified portfolio. The priority now is to build the mechanisms that allow Irish savers to access those opportunities efficiently, responsibly and at scale.