In 30 minutes onstage at PERE’s annual Europe Forum this week, Ivanhoé Cambridge’s chief executive officer Nathalie Palladitcheff addressed many of the private real estate sector’s biggest headwinds at the moment.

But while she spoke about issues, including the banking crisis’s impact on real estate and the industry’s deprioritization of ESG, her own biggest challenge is staying aligned with other organizations that do business with the real estate platform of the Quebec state pension Caisse de dépôt et placement du Québec.

“What is my main challenge today? I will tell you it’s misalignment,” she told PERE’s approximately 300 delegates. “The most difficult thing [for us] in the construction of the portfolio is to find the people with whom we’re going to be completely aligned with, which is very rare right now.”

In the keynote session, Palladitcheff offered examples of misalignment, including working with managers wanting to introduce retail capital to their operations, raising conflict issues in the process. Accepting the “high temptation” to mix individual investors’ money with that of institutions, she questioned how managers could hope to meet the expectations of each. “How are you going to be sure to keep the same focus? How are you going to allocate your acquisitions between the two kinds of vehicles? Are you going to ensure those people are going to act as institutions do?” she asked.

When the conversation turned to the private REIT redemption queues in the US that started at the end of 2022, she said: “I’m sure nobody here panics, as it’s our job to keep our heads and eyes on the horizon. But it’s impossible for an individual. They just want their money back to do something else.”

In another example of misalignment, she expressed concerns about developers and other operationally intensive real estate businesses becoming fiduciary fund managers too. “They are saying: they are good at what they do, so why can’t they collect the money and do the same too? But it is not the same at all. [I’ve found] there’s a big change in terms of how they behave when they get that new business card.”

Palladitcheff said she has never known more areas of misalignment than in the current market context: “Even though I have a lot of friends inside and outside this room, everyone has an agenda which is very different from mine.”

With misalignment becoming a growing concern and with the industry facing unprecedented levels of change in terms of how real estate is expected to be operated, managed and occupied, she called for greater leadership to be demonstrated. “It’s not about capital anymore. That was 10 years ago. Now it is about leadership, those who will make the difference.”

She was speaking just two months after being awarded with PERE’s Lifetime Achievement Award in the 2022 PERE Global Awards. One of the main factors behind her win was executing a three-point strategic pivot at the investor, including extensive divestments on its C$77 billion ($57 billion; €52 billion) asset base. The plan resulted in two consecutive years of index-beating returns. You can read the interview here.