Sovereign wealth funds are hunting for real estate

Focus will be on residential and industrial purchases, according to survey

National Weekend Edition /
Jul.July 18, 2021 12:00 PM
Sovereign wealth funds are hunting for real estate

(iStock)

Sovereign wealth funds and central banks are looking to capitalize on post-pandemic real estate investment opportunities, following a brief pullback last year.

Nearly three quarters of industry respondents to an Invesco survey believe the pandemic-fueled price fall in valuations will drive property purchases, according to IPE Real Assets.

Participants in the survey included 141 sovereign wealth funds and 82 central banks with a collective $19 trillion in assets.

Average real estate allocations among respondents is down to 8.3 percent this year from 9 percent in 2020 and 8.7 percent in 2019. But around half of wealth funds plan to increase real estate activity from 2020 levels, and about a quarter plan to maintain last year’s level of activity.

Respondents rated industrial and residential properties as more attractive than office and retail properties, which bore the brunt of the pandemic’s economic impact.

Data centers were the most desirable sector based on anticipated yields over the next five years, respondents said in the survey. The growth of the online economy is driving demand for data storage and the sophisticated infrastructure needed to support the modern internet ecosystem.

Leasing slowed last year but is expected to accelerate to potentially record levels. Rents also surged in secondary markets in the second half of 2020. [IPE] — Dennis Lynch https://realassets.ipe.com/news/sovereign-funds-tipped-to-revive-activity-after-real-estate-allocations-fall/10053979.article





    Related Articles

    arrow_forward_ios
    JetBlue cancels flight to Florida, keeps HQ in New York City
    JetBlue cancels flight to Florida, keeps HQ in New York City
    JetBlue cancels flight to Florida, keeps HQ in New York City
    Mayor Bill de Blasio (Getty, iStock)
    NYC to require vaccines for indoor dining, gyms and performance venues
    NYC to require vaccines for indoor dining, gyms and performance venues
    Family feud for $11M Lundy’s restaurant building boils over
    Family feud for $11M Lundy’s restaurant building boils over
    Family feud for $11M Lundy’s restaurant building boils over
    One New York Plaza and 60 Broad Street (Brookfield, Google Maps)
    Manhattan office rents hit 4-year low as availability remains at record-high
    Manhattan office rents hit 4-year low as availability remains at record-high
    The rise of e-commerce, fueled by the pandemic, has created unprecedented demand for cardboard-producing facilities. (iStock)
    Cardboard demand could fuel an industrial real estate boom
    Cardboard demand could fuel an industrial real estate boom
    MSCI CEO Henry Fernandez and Real Capital Analytics founder Robert White (MSCI)
    MSCI to acquire Real Capital Analytics for $950M
    MSCI to acquire Real Capital Analytics for $950M
    Donald Trump and the Trump International Hotel & Tower in Chicago (Getty, iStock)
    Donald Trump is owed $1M tax refund on Chicago skyscraper
    Donald Trump is owed $1M tax refund on Chicago skyscraper
    From left: One WTC, Douglas Durst, Donald and Steven Newhouse (iStock, Getty)
    Condé Nast pays back rent at One WTC, ending standoff with Durst
    Condé Nast pays back rent at One WTC, ending standoff with Durst
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...