Real Estate Funds: Challenges of a Growing Opportunity Set
The noncore real estate fund universe is now truly a global universe, with only 41 percent of offerings in 2007 focused on the United States. This is welcome news for many investors who, for almost a decade now, have recognized that developed markets around the world can attractively increase the opportunity set and that emerging markets offer an attractive risk premium in some cases. The challenge has been how to implement and take advantage of these situations when the industry “infrastructure” did not appear to keep pace with investor demand for real estate investment vehicles. Finally, investors have a sufficient choice of alternatives to expand their real estate investment programs around the globe. The new challenge has become evaluating a diverse and widely dispersed universe of sometimes new or untested managers.
The table below summarizes noncore, closed-end funds — categorized by geographic region as stated in fund investment strategy — t