Institutional Investors May See Too Much Investment in CRE

A returns performance gap may mean some institutions put the brakes on new investment paces.

The rapid climb in commercial real estate values has been great for investments. But, ironically, because of the denominator effect, it may have been too good for some institutional investors. And that’s bad because these big players might pull back continued new investment due to the denominator effect. At least, that’s the suggested result of a recent study from HodesWeill & Associates and Cornell University’s Baker Program in Real Estate.

The annual Institutional Real Estate Allocations Monitor survey took place between May and October 2022. The study was of 173 global institutional investors, including pension plans, insurance companies, sovereign wealth funds, endowments, and foundations with a combined $11 trillion total assets.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

Unlimited access to GlobeSt and other free ALM publications
Access to 15 years of GlobeSt archives
Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
1 free article* every 30 days across the ALM subscription network
Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account? Sign In Now

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Erik Sherman

Dig Deeper

Recommended Stories

Consumer Geo-Tracking a Boon to Apartment Marketers

Richard Berger | May 08, 2024

With precise details, campaigns can be optimized to reach prospective renters at the right time and place.

Another Regulator Weighs In On CRE

Erik Sherman | May 08, 2024

The PCAOB says there’s danger of companies using ‘unrealistic assumptions’ to make the numbers work.

Troubled CRE Is Tapering While Sales Out of Distress Increase

Erik Sherman | May 01, 2024

But the net total has reached more than $88.6 billion with a potential of almost $206 billion.

Resource Center

Better decisions come from better data, insight and coordination. Download this guide for insights on how to optimize the lease administration process and recommendations for best practices to deliver increased ROI across the lease lifecycle.

Guide

Sponsored by LeaseAccelerator

The Real Estate Leader's Quick Guide: Insights for Better Lease Administration

Better decisions come from better data, insight and coordination. Download this guide for insights on how to optimize the lease administration process and recommendations for best practices to deliver increased ROI across the lease lifecycle.

Browse More Resources ›

Discover how to transform your real estate assets from mere spaces into vibrant experiences that captivate tenants -- and their employees -- to support engagement and retention.

Guide

Sponsored by HqO

How to Develop a Real Estate Experience (REX) Strategy for Your Tenants

Discover how to transform your real estate assets from mere spaces into vibrant experiences that captivate tenants -- and their employees -- to support engagement and retention.

Browse More Resources ›

Cementing your CRE portfolio’s long-term growth means assembling a great tech stack to support your goals. However, selecting the right solutions takes preparation and research. This guide outlines five areas of consideration to help you find the right fit.

Guide

Sponsored by Building Engines

How to Choose the Right Building Operations Tech to Boost Your NOI

Cementing your CRE portfolio’s long-term growth means assembling a great tech stack to support your goals. However, selecting the right solutions takes preparation and research. This guide outlines five areas of consideration to help you find the right fit.

Browse More Resources ›

GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
Exclusive discounts on ALM and GlobeSt events.
Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now

Copyright © 2024 ALM Global, LLC. All Rights Reserved.