Moving up the risk curve: Investors searching for appropriate risk-adjusted returns are modifying their investment style
Greater confidence in Europe’s economic backdrop, rising valuations in core property markets and lacklustre bond yields have all combined to create growing hunger for real estate’s riskier assets.
A survey of real estate investors and fund managers published in January by INREV, the European Association for Investors in Non-Listed Real Estate Vehicles, found increased appetite for risk in 2015. It showed that 41.1 percent of investors cited value-added as their preferred fund style, while 17.8 percent cited opportunistic as their preferred fund style. Meanwhile, 41.1 percent cited core.
The figures compare with INREV’s investment intentions survey in 2014, which found that 41.7 percent of investors said that value-added would be their preferred strategy over the course of the year, while just 7.1 percent favoured opportunistic and a significant majority of 51.2 percent favoured core. So, an interesting change in sentiment over the course of the year and symptomat