In a sponsored interview published in the October issue of Institutional Real Estate Americas, Chris Graham and Ettore Spezzotti, managing directors at Blue Owl, discuss the importance of breadth and flexibility in their real estate credit strategy, and why allocators should not necessarily treat real estate credit as a sub strategy of private credit.
“[Real estate credit] offers a degree of downside protection given its senior position in the capital stack, and in the same asset class that institutional investors already underwrite. It sits between fixed income and real estate equity on the risk spectrum. It complements corporate private credit by diversifying the credit risk factor with different collateral and cycle drivers. It also complements real estate equity by offering higher current income, but without capital appreciation or the long-term hold. It’s not a replacement for either bucket; it’s its own third leg.”
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