In today’s low-interest-rate and low-growth environment, global core real estate plays a crucial part in portfolios. With its predictable cash flows, it can act as a foundational asset class that delivers low-equity beta, high income and attractive liquidity.

Low-to-negative interest rates across the globe have stifled investors’ ability to generate sustainable yields from the public markets. We see this as an opportunity for high-quality global core real estate to serve as a relatively stable source of income. The total amount of global bonds with a negative yield surpassed €11.5 trillion in June 2019 and approximately 40 percent of all bonds globally are yielding less than 1 percent. In real estate, however, unlevered cap rates in global developed markets are still in the mid-single digits range.

Although some believe that developed market real estate is becoming richly valued, it is important to view this in the context of the broader universe of available inv