- March 2012: Vol. 24 No. 3

To read this full article you need to be subscribed to Institutional Real Estate Americas

Investment Strategies and Timing: Vintage Year Benchmarks Can Provide New Performance Insights

by Jim Valente

Investors in private equity real estate encounter unique challenges developing and executing an investment strategy when compared to investors in either stocks or bonds. Specifically, the process of buying and/or selling physical assets places constraints on the speed and cost of executing a new strategy or tactically shifting an existing strategy to reflect changing market conditions and investor expectations. If investors are over- or underweight versus their targeted allocation to stocks and bonds, they can quickly and efficiently change their portfolio’s exposure to these asset classes, or to specific sectors or risk strategies within either asset class.

In private equity real estate, the process is much slower and more costly. Indeed, between the time investors make an allocation to private equity real estate and when they actually become invested, the economy, capital markets and property markets can change such that a well-thought-out strategy results in underperform

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