The elusive benchmark: Real estate investors are still in search of the most appropriate benchmark
Regardless of the asset class, the ability to generate superior investment performance is the measurement that separates good investors from great investors. In most asset classes, performance is easily compared and contrasted against a commonly agreed upon investment universe or an appropriate index of investment opportunities. But in private real estate, investors face the dilemma of attempting to evaluate performance without the benefit of a commonly agreed upon benchmark, as globally comprehensive real estate return comparisons still remain elusive.
This article, based on a larger Partners Group research piece, examines the indices available to today’s global real estate investor and aims to give an overview of their origins, comprehensiveness, and strengths and weaknesses. However, it is our belief that despite greater real estate index availability today than ever before absolute returns comparisons often provide investors with the most pragmatic solution to benchmark