The current status of real estate secondaries

Millennials continue to pleasantly surprise the baby boomer and generation X population as of late, and like millennials, the real estate secondaries market, born in the 1990s, has seen a tremendous amount of growth in the past five years.

Min Zhou, vice president at Landmark Partners, says there is a general consensus in the real estate investment community today that we are late cycle and that value is high, having seen peaks in all major markets. That being said, certain markets have experienced a deterioration in fundamentals and private real estate continues to provide a reliable income for investors’ portfolios and offers an attractive yield spread to fixed income.

“Given that dynamic, investors are increasing or maintaining their allocation to private real estate while increasingly focusing on strategies with defensive attributes,” says Zhou. “Real estate secondaries have attracted investors’ attention in recent years because it has these important defensive attributes, including acquiring assets at discount to market value, exposure to seasoned assets, accelerated distribution and diversification.”

To learn more on historical and present data findings behind the real estate secondaries market, watch the entire video interview.