Private real estate’s top capital collectors have not budged since last year, with Blackstone, Brookfield Asset Management and Starwood Capital Group holding steady at the top of the PERE 100 ranking.

Blackstone’s latest global fund, Real Estate Partners IX, has delivered a total net internal rate of return of 19 percent since it began investing in 2019, according to the company’s first quarter earnings report. Since 1994, the BREP series has a net realized IRR of 17 percent. Brookfield, though it has a shorter track record, has achieved an 18 percent gross IRR for its flagship Strategic Real Estate Partners series since inception, according to its 2020 year-end report.The continued dominance of these groups demonstrates the market’s support for big, diversified funds and investors’ willingness to keep backing firms that deliver on lofty returns.

Starwood, for its part, has delivered a 19.2 percent IRR for its Distressed Opportunity Fund XI, according to a meeting document from one of its investors, the Oklahoma City Employee Retirement System. In January, the Miami Beach manager held a first close for its follow-up fund with $6.5 billion – well on the way to its $7.5 billion

While Blackstone and Brookfield saw their five-year fundraising totals fall between 2020 and 2021 – down $15 billion and $1 billion, respectively – the overall PERE 100 pie grew by 3 percent year-on-year, eclipsing $500 billion. So, even as activity was muted by the pandemic, institutional capital continued to covet higher returning value-add and opportunistic funds.

Returns for more non-core strategies are harder to track than their core peers. This is due, in part, to regulatory sensitivity around perceived marketing, a lack of an industry-wide benchmark like NCREIF’s Open-end Core Diversified Equity index, and variations in return calculations. But earnings releases by listed firms show managers up and down the PERE 100 beating the ODCE benchmark last year.

New York-based KKR achieved an IRR of 16 percent from April 1, 2020 through March 31, 2021, far exceeding the ODCE index’s 2.32 percent and more encompassing NCREIF Property Index’s 2.5 percent during the same period. Through the first quarter of this year, KKR reported an IRR of 6 percent versus the 2.1 percent for ODCE and 1.7 percent for NPI. The firm jumped 15 spots from 26th in last year’s ranking to 11th.

Los Angeles-based Ares Management achieved a net return of 5.7 percent for its US real estate equity platform and 6 percent for its European counterpart during the first quarter of 2021. The firm is 15th in this year’s ranking. Meanwhile, Apollo Global Management, in 18th place, notched a 3.6 percent gross return for the quarter and 12 percent over the previous 12 months for its real assets platform, which is 74 percent real estate but also includes allocations to infrastructure and principal finance.

Though not a comprehensive view of the market, these returns give a positive snapshot of non-core performance during the pandemic, says Doug Weill, co-managing partner of the New York capital advisory Hodes Weill & Associates.

“Looking at the public fund managers that report quarterly returns gives a pretty good sense of what’s going on in the market,” he says. “These managers reported positive returns for both their opportunistic and core portfolios for the full calendar year. That provides a good indication that portfolios have held up relatively well.”

Some opportunistic managers have put up less eye-catching return figures and have seen their position slide on the PERE 100. The Carlyle Group, for example, has recorded a net IRR of 11 percent for its 2016-vintage Carlyle Realty Partners VIII fund. The vehicle, which is one year from its stepdown date, was less than 60 percent invested at the end of March. The Washington, DC-based manager fell from the seventh spot in 2020 to 27th this year.

Matthew Casper, partner at New York-based advisory PJT Park Hill, says success over the past year was dictated by asset allocation. Industrial properties, which were boosted by rising e-commerce, delivered returns of 14.1 percent over the past year, according to NCREIF’s property index. Hotels, on the other hand, saw returns of negative 24 percent.

With covid-19 generally speeding up pre-existing trends, the past year has led to exaggerated highs and lows, he says. “A lot of strong opportunity fund manager performance was driven by savvy market and sector selection, backed by secular trends that had economic and demographic tailwinds,” Casper adds.