Landscape Study: Investors reveal their favored sub-sectors

The PERE Research & Analytics team's Real Estate Landscape Study drills down on investor views on covid recovery, real estate's place in their portfolio, which sub-sectors are most favored and more.

This year, in addition to the wealth of data collected from the annual Investor Perspectives 2021 Study, the PERE Research & Analytics team took a deeper dive into the minds of those capitalizing the real estate asset class by conducting a Real Estate Landscape Study.

The study captures investors’ appetite for real estate over the next two years, the primary role that private real estate investments have in portfolios, and critically, identifies which sub-sectors of logistics, residential, office, retail and debt hold most appeal.

A total of 76 institutional investors globally were surveyed, with fieldwork carried out in Q4 2020.

Long-term confidence

The results of PERE’s Landscape Study indicate that institutions’ confidence to invest in the asset class will be strongest two years from now, but only 25 percent are positive about investing in the first half of 2021.

Given the covid-19 backdrop and the economic uncertainty it is yielding, this result should not be surprising. A significant proportion of respondents to our study – 52 percent – also view real estate as a return enhancer within their wider private markets portfolio, while 30 percent see it as a surrogate for fixed income. Only 14 percent consider property to be a diversifier.

And finally, direct investment is the preferred route into the sector for 67 percent of investors polled, with 57 percent opting to invest indirectly.

 

Sector preferences

 

 

About the respondents