As the world’s largest sovereign wealth funds benefit from rising energy prices and growing economies, many are expected to increase their allocation to the real estate asset class. A report from German real estate investment firm Degi predicts allocations will rise to 15 percent over the next few years, from an average of four to 11 percent.
INREV is overhauling its definitions of core, value-added and opportunity funds after finding that measuring internal rates of return as well as leverage is not the best way to classify them.
The state’s legislature has increased the Florida State Board of Administration’s allowable allocation to private equity and venture capital from 5 percent to 10 percent. The pension fund is also launching an infrastructure platform.
Limited partners are starting to reduce the number of relationships with fund managers. And as investors start shedding the pounds, private equity real estate secondaries are getting ready to pick up the slack. By Zoe Hughes
Ex-AIG hotels head Keith Lindsay has joined Central Eastern European developer and asset manager Orco to run its hospitality division.
Respondents to a recent survey also said sovereign funds’ long-term strategy makes them more appealing than other LPs.
The $82bn Washington State Investment Board, known for its bullish stance on alternatives, had a minus two percent first quarter return on its private equity portfolio, while real estate underperformed against its benchmark. Executive Director Joseph Dear says ‘we’re in this asset class to stay’.
Alternative assets managed by the world’s top 99 investment managers on behalf of pension funds grew by 40 percent over the past year, according to consulting firm Watson Wyatt.
Alternative assets managed by the world’s top 99 investment managers on behalf of pension funds grew by 40 percent over the past year, according to consulting firm Watson Wyatt. Real estate managers occupied the top nine positions, managing 62 percent of pension fund assets.
The Dallas-based business is in the middle of building a pan-European portfolio of hotels for a fund that has now deployed 50 percent of its capital.