With equity markets trading at historically high valuations and inflationary pressures weighing on investors, financial advisers are increasingly turning to private real estate as a source of diversification, stability and a hedge against inflation. The NCREIF Fund Index – Open-end Diversified Core Equity (NFI-ODCE), long regarded as the benchmark for private real estate and representing nearly $300 billion of low-levered, core assets, has recently emerged from only its third major drawdown in nearly five decades, delivering four consecutive quarters of positive returns. For many advisers, this reset is creating what looks like a favorable entry point.
But the increased focus on private real estate as an alternative asset class comes against a complicated backdrop: At the same time that interest in the asset class is rising, many legacy funds that offer exposure to private real estate have struggled with poor performance, liquidity constraints, valuation pressures or portfo
