The assumption that the path to high realized portfolio returns is simply the sum of a series of high individual targeted returns is a recipe for disaster. In this article we describe the Returns Fallacy and describe techniques investors can use to improve their realized investment returns.
A risk-adjusted return is a measure that puts returns into context based on the amount of risk involved in an investment. In this article we walk you through a detailed process for estimating relative risk-adjusted returns across various commercial real estate investment opportunities.
In this article we walk you through the ten most common source of risk present in commercial real estate investment opportunities. After reading, you should better understand the relative levels of risk present in the opportunities you evaluate and be able to insure you are being adequately compensated though appropriate risk-adjusted returns.
Diversifying within a real estate portfolio is easily achievable but it requires an understanding of the different levers you can pull to generate it. In this article, we explore those levers and highlight the various ways to pull them to assemble a well-diversified real estate portfolio.
Within private equity real estate, assets are typically grouped into four primary categories based on investment strategy and perceived risk. Those four categories are core, core-plus, value-added and opportunistic. The key differentiator between these categories is the risk and return profile. Moving between these strategies is a bit like stepping up the ladder in terms of taking on more risk, and in theory, being compensated for that risk with a higher return. For this article, we will describe each category and outline the typical level of leverage used for each in order to clearly illustrate the concepts involved.