The top 10 is not representative of the full ranking
The top 10 largest institutions in the Global Investor 100 are not reflective of the overall ranking. While they represent only 10 percent of the ranking by number of investors, they account for 30 percent of the total equity allocated to private real estate.
North America claims 39 percent of the capital allocated by the 100 investors, but only 27 percent of the top 10’s aggregate real estate allocation. Meanwhile, the Middle East North Africa region represents only 7 percent of total capital allocated but 22 percent of the top 10’s allocated capital – in fact, the only two Middle-Eastern institutions on the GI 100 are both in the top 10. Public pensions constitute 50 percent of the overall capital allocated by the GI 100, but only 12 percent of the top 10.
Dramatic ranking moves are rare
Comparing the top half of this year’s GI 100 to last year’s GI 50, the ranking has stayed relatively consistent. Thirty-six institutions moved five spots or fewer on the list, while only five groups have seen double-digit changes: Tokyo’s Dai-ichi Life Insurance Company; Hong Kong Monetary Authority; Dutch asset manager MN; Denmark’s PFA Pension; and US university endowment Stanford Management Company. However, these jumps were the result of either drastic changes in exchange rates or access to more detailed data for some of these investors, rather than the institutions making meaningful adjustments in their allocations.
Top 20 are bigger allocators
The 20 largest investors on the ranking stand out not only for having the largest allocations to private real estate among the 100 institutions, but also a higher-than-average percentage allocation to the asset class. The groups that rank 1 to 20 had designated on average 15 percent of their total holdings to private real estate.
In fact, eight of the top 20 had percentage allocations that were higher than 15 percent, while the allocations of four institutions exceeded 20 percent. By contrast, the investors that placed 21 to 100 had an average allocation of 9.2 percent.
Real estate allocations varied widely among investors
The top 50 investors show a significant disparity in the size of real estate allocations among institutions, ranging from $62.1 billion for top-ranking Abu Dhabi Investment Authority to $4.2 billion for 100th place finisher QSuper.
There is little correlation with the size of an investor’s private real estate allocation and the percentage of its overall portfolio that was allocated to the asset class, however. Although the allocation percentages are as large as 71.9 percent for second-place Allianz Real Estate and as small as 0.7 percent for 70th place UniCredit, the institutions with the largest and smallest private real estate allocations actually were similar in terms of their allocation percentages: 7.5 percent for ADIA and 5.3 percent for QSuper.
In fact, more than half of the GI 100 have allocations of less than 10 percent to private real estate, including half of the top 50 investors on the list.
Differences between the top 50 and bottom 50
With 2020 marking the first year where PERE expanded its list to 100 investors, one obvious question was how doubling the number of investors would affect the ranking. One impact has been stronger European representation – with 22 of the bottom 50 investors based in the region, compared with 17 in the top 50. Another impact was the boost in representation for certain investor types. Although PERE counts 26 public pensions, one private pension and 12 insurance companies in the top 50, those numbers grew to 27, seven and 13, respectively, in the bottom 50.