By PE Edge Editorial Staff
Hodes Weill & Associates and Cornell University published their annual Institutional Real Estate Allocations Monitor on real estate in institutional portfolios and the effects of institutional allocation tendencies on the investment management sector.
The study collected research on a blind basis from 175 institutions in 25 nations, the report said.
One of the main findings is institutional target allocations to real estate remained flat for the first time in 10 years at 10.8%, the study stated. Additionally, there is increasing optimism that buying opportunities will appear as valuations find a bottom, it said.
“While target allocations are flat year-over-year, this follows 10 years of increases totaling 190 basis points, which represents an increase of over 20%,” said Douglas Weill, Managing Partner at Hodes Weill & Associates.
Investors are deploying capital to specific opportunities with caution because of devaluations concerns, as interest rates have continued higher for longer, the research found.