Publications

- December 1, 2016: Vol. 10, Number 11

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Playing the long game: A successful city is the sum of many parts

by José Pellicer and Radu Mircea

Open-end funds can wait. Closed-end funds can’t. It seems obvious, but what are the strategic implications? What can an open-end fund do that a closed-end fund cannot? One answer is that an open-end fund can “play the long game” — a planning gain, an urban change story, a long-term trend, etc.

An IRR-driven, finite-life closed-end fund can’t afford to do that. IRR is a function of time — the more time that elapses, the lower the IRR. Closed-end funds are for the short term, for the opportunity, the cycle. Open-end funds are for the long game.

This article is about long games — urbanisation, high-growth cities, gentrification — and about how open-end funds can benefit from this.

High-growth cities

Megatrends are processes that occur over a long period of time. In that journey, they affect everything that they touch — the economy, the social construct, politics and, of course, the real estate market.

The urbanisatio

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