Why invest with private real estate managers? The theory is that they provide investors with four things: greater returns, diversification, access to entrepreneurs and highly-informed decisions.
Those four characteristics, however, are not the sole preserve of the largest or the best-known general partnerships. Indeed, chances are that smaller or niche operations could yield at least as good a chance of success.
With this in mind, PERE is proud to present our annual feature on emerging managers to watch. Starting on page 33, you will find our 10 picks for nascent fund managers with the potential for future success, produced in consultation with experts in that segment of the market. We hope you enjoy our selections.
Also, beginning on page 26, is our interview with PIMCO. Though few seem to know much about the fixed-income behemoth’s real estate business, it has $15 billion of opportunistic-style real estate under management and is filling a gap left by firms that have exited the sector. Returns apparently have been stellar, clients love the diversification and PIMCO has made some highly-informed decisions, so check out the team behind it.
Speaking of informed decisions, this issue of PERE also carries analysis of investment theses around the world. For example, for news of firms investing in hitherto overlooked areas that now are benefiting from the US fracking boom or the energy industry in general, see Katherine Bucaccio’s article on page 12.
Then, on page 19, guest commentator Roger Barris of Peakside Capital issues a caution on the apparent rush to industrial and logistics property in Europe among those looking for high returns. He ties in e-commerce and 3D printing to question whether the rush is sensible.
Meanwhile, as Jonathan Brasse reports in our annual Asia roundtable, investors are turning to entrepreneurial managers for core real estate as they seek diversification. You can read about that trend beginning on page 40.
As if that wasn’t enough, PERE also highlights the top investment thesis borne out of the global financial crisis – debt. With support from sponsors, we bring you the 2013 Guide to Special Situations and Debt Funds, published alongside the main issue.
As I mentioned earlier, private equity real estate is meant to provide attractive returns, diversification, access to entrepreneurs and highly-informed decisions. What it doesn’t provide is a guarantee. Nevertheless, we hope that this issue provides some useful weaponry to help you succeed.
Enjoy the issue,