The NCREIF PREA Reporting Standards has published Increasing Transparency in Performance Metrics for Private Closed-End Funds, offering long-awaited industry guidance aimed at enhancing clarity, consistency and comparability in performance reporting for private closed-end real estate funds.
Developed by the Reporting Standards Performance Disclosure Task Force along with members of the Fee and Expense Disclosure Task Force, the white paper consolidates extensive industry input and addresses three critical topics where formalized guidance has been limited:
Net fund-level internal rate of returns (IRRs) calculated with and without subscription facilities
Gross IRRs for realized versus unrealized portions of fund portfolios, shown separately
Clarification on the calculation and use of multiples reported alongside IRRs
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