Real Estate Funds

Investigating the relationship between capital structure and the performance of non-listed real estate funds: focusing specifically on the role of leverage in hedging against inflation
ANREV
15 Feb 2017

A panel data regression analysis was undertaken on a unique, unbalanced panel of APAC non-listed real estate funds to determine the role of leverage in hedging against actual and unexpected inflation with a focus on core funds. There is evidence that APAC non-listed real estate funds provide hedging against inflation and that the use of debt enhances their hedging capabilities. Furthermore, the results show that while leverage enhances a fund’s inflation hedging capability at moderate levels, its benefits are not unrestricted. The results imply that investors can extract information about inflation hedging abilities of non-listed real estate funds from capital structure data, promoting efficient investment decisions. The significance of the results may be influenced by the size of the dataset (119 APAC non-listed real estate funds invested in more than 10 countries across the three styles over the period of 2006-2014).

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Fund Manager Survey 2016
ANREV INREV NCREIF
May 2016

According to the latest ANREV, INREV and NCREIF Survey of real estate fund managers, total real estate assets under management (AUM) reached US$2.19 trillion in 2015. Overall, the 10 largest fund managers represent 41.0% of the total AUM, up from 36.5% last year. The survey found:

  • Real estate assets under management grew to US$2.19 trillion
  • The big managers keep getting bigger
  • North American and global strategies are much larger than other strategies

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What To Look For In Unlisted Real Estate Funds

In the current low interest rate environment, the hunt for yield is a powerful force. Non-residential real estate via listed real estate investment trusts (A-REITs) and unlisted real estate funds (syndicates) have both benefitted from strong investment inflows.

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