Investors - JULY 24, 2014

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Report: No difference in historical performance between high-return strategy classifications

by Reg Clodfelter

A new report from Landmark Partners suggests the distinction between value-added and opportunistic is not as useful as commonly believed. Though they are usually classified with separate risk/return profiles, there may be little difference in absolute or relative performance between value-add and opportunistic funds, according to Real Estate Private Equity Funds: How useful are class distinctions?

“Our portfolios at Landmark incorporate significant numbers of funds that were originally marketed by their sponsors as either value-added or opportunistic programs, and we have noted that many investors plan their real estate allocations to target specific levels for each of these types of funds,” explains Paul Mehlman, partner with Landmark and contributing author on the report. “Opportunistic funds are typically presented as targeting higher returns than value-added funds, so we want

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