Publications

- February 1, 2016: Vol. 3, Number 2

To read this full article you need to be subscribed to Real Assets Adviser

Demographics, Technology, Urbanization: The DTU method of investing in real estate

by Jacques Gordon and Bill Maher

As real estate values rise to new heights in major cities across the world, investors need “cycle insurance” to protect the value of their portfolios in the event of a cyclical downturn. One of the ways to protect a portfolio from a downturn is to seek out properties and markets that participate in longer term secular shifts in economies or societies. Such investments should exhibit a degree of immunity from the cyclical ups and downs of the credit cycle, the business cycle and the real estate supply-demand cycle. In a sharp downturn, like the 2008–2009 global financial crisis, all property values decline. But, in the ensuing recovery, assets that serve secular demand drivers often outperform. By definition, these secular trends supersede cyclical ups and downs and, given enough time, distinguish themselves as fundamental determinants of long-term return — for better or for worse.

Each industry has its own set of secular trends. For instance in computing, Moore’s La

Glossary, videos, podcasts, research in the Resource Center

Forgot your username or password?

Close your account?

Your account will be closed and all data will be permanently deleted and cannot be recovered. Are you sure?

We respect your privacy! Please give consent for processing data as described in our Privacy Policy