Practical Applications of Another Look at Private Real Estate Returns by Strategy

Practical Applications Summary

In Another Look at Private Real Estate Returns by Strategy, from the Special Real Estate Issue 2019 of The Journal of Portfolio Management, authors Mitchell A. Bollinger and Joseph L. Pagliari, Jr., demystify the levels of risk-adjusted, net-of-fee returns that investors earn across value-add and opportunistic real estate funds, in comparison to the returns of core-strategy funds. The article also examines the fee structures across these various real estate strategies, and evaluates whether or not they are justified. They conclude that core strategies have outperformed both value-add and opportunistic strategies on a risk-adjusted net-of-fee basis.