- January 1, 2023: Vol. 35, Number 1

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Real estate secondaries provide alternative liquidity source for LPs and GPs

by Loretta Clodfelter

Investors are looking to alternative forms of liquidity in the current market environment, including real estate secondaries.

“As central banks around the world reduce the amount of liquidity in the markets, and investors deal with the resulting impact, we are seeing investors increasingly seek alternative forms of liquidity through the secondaries market, which is comprised of both the traditional LP segment as well as the newer GP-led segment,” explains Jeffrey Cho, managing director with Portfolio Advisors.

“On the LP side of the market, we experienced a brief pause in the second quarter due to public market volatility, but we are now seeing a significant increase in the number of LP portfolios coming to the secondaries market,” says Cho. He notes there are a host of factors leading to this increase in deal flow, with some sellers forced to access the secondaries market to address the denominator effect on their investment portfolios.

“On the GP-led

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