For institutional real estate investors who are engaged in the business of maximizing returns on illiquid assets, any year can be a dicey one — that is, a 12-month stretch in which property values are squeezed but escape hatches shut — and 2025 is certainly no exception.

Diversification remains the primary rationale for allocating to real estate. However, macroeconomic and geopolitical risks pose significant concerns for global investors in 2025, as highlighted by the ANREV/INREV/PREA Investment Intentions Survey 2025.

Five years on from the start of the pandemic lockdowns, this article takes stock of where coastal innovation “gateway” metros are in the real estate cycle. Specifically, we highlight the resilience of U.S. gateway metros amid the significant challenges they faced during and after the pandemic.

Recent announcements by Australian Retirement Trust, which plans to invest $1 billion in and with private real estate operating companies (REOCs) through an external manager, and Switzerland’s Partners Group, which is also doing more platform investing, appear to indicate some investors are pursuing variations of platform investing strategies. Given the tough fundraising environment and the resetting of asset valuations, now may be an auspicious time to consider these investment opportunities.

Somewhat coincidentally — but also possibly a telling data point — total returns for public and private real estate benchmarks — FTSE Nareit All Equity REITs Index (FNER), NCREIF Property Index (NPI) and NCREIF Fund Index – Open-end Diversified Core Equity (NFI-ODCE) — were virtually identical over the past decade. Annual average gross returns for the three major U.S. real estate benchmarks were all between 5.7 percent and 5.9 percent for the 10 years ending in fourth quarter 2024.

Franklin Templeton and its specialist investment manager, Clarion Partners, have announced Clarion Partners Real Estate Income Fund’s entry into the industrial outdoor storage (IOS) subsector via a debt investment in an eight-property multi-city portfolio and the purchase of an IOS property in Houston.

Core-plus funds affiliated with Blackstone Real Estate have agreed to acquire a 95 percent stake in an industrial portfolio developed by Crow Holdings for $718 million.

3650 Capital has secured $215 million in new capital commitments from the California State Teachers’ Retirement System (CalSTRS) and Mubadala Investment Company. The new capital will be allocated across 3650’s three investment strategies.

Related Cos. has launched Related Digital, a vertically integrated data center development and investment platform.

RCG Ventures has announced the approximately $1.1 billion first close of acquiring a multitenant retail portfolio from Global Net Lease.

Blackstone has held a final close of its most recent real estate debt fund, Blackstone Real Estate Debt Strategies V (BREDS V), which has approximately $8 billion of total capital commitments.

Recently several U.S. pension funds have committed to value-added styled funds for their real estate allocations.

Institutional investors globally are pivoting to more of a risk-on posture, seeking new opportunities in niche markets as macro conditions shift. Capturing the views of the largest investors in the world with participation of 800 institutions representing $19 trillion in assets under management, Nuveen’s EQuilibrium Global Institutional Investor Survey.