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.