Long-term real estate investments to outperform stocks and bonds: report

Real estate, private equity could see 12 percent annual return over next 10 years
January 13, 2014 04:40PM

For investors looking to maximize long-term returns, assets that lock up funds for years shouldn’t be overlooked.

At the moment, investors are keen to focus on assets that can easily be cashed out at a moment’s notice — a tendency that is holding back portfolios from returns that could be far greater, according to a new outlook report from Citi Private Bank cited by CNBC. Real estate, hedge and private equity funds, and other such “illiquid” asset classes are the place to park investment dollars to maintain greater control and net a higher return, according to the report.

Private equity and real estate, according to the report, will generate an 11.9 percent rate of annualized return for investors over the next ten years — a drop from 2009 estimates but well above the 3.4 percent estimated return for corporate credit, or 6.7 percent for large-cap stocks in the same period of time. [CNBC]Julie Strickland