Research highlights regional differences in total expense ratios

New research reveals a divergence of non-listed real estate total expense ratios (TER) between Asia Pacific and Europe. According to the INREV/ANREV Management Fees and Terms Comparison Study 2019, the average TER for non-listed real estate funds in Asia Pacific is 1.04 percent on a gross asset value basis (GAV) before performance fees, compared to 0.86 percent in Europe. The disparity also exists when TER is calculated on a net asset value (NAV) basis.

The study identifies size as an important determining factor for TER. While larger vehicles (over €1 billion/$1.11 billion in value) have similar TERs on a GAV basis in both regions; medium sized funds (€500 million to €1 billion/$554 million to $1.11 billion) reached 0.71 percent in Europe and 0.90 percent in Asia Pacific; small funds (less than €500 million/$554 million) had the highest average TER by comparison and the biggest disparity between the two regions, at 1.07 percent in Europe and 1.67 percent in