Preqin’s data has identified asset managers as being the most likely investor group to be planning new commitments to private real estate funds, with 80% of this investor group expecting to be active over the next 12 months. Fifty-nine percent of insurance companies active in the real estate asset class are in search of new funds in the coming year. More than 50% of endowment plans and real estate fund of funds managers are also planning new fund commitments in the near future.
Over 50% of North American and Asia-based investors are planning new commitments in the next 12 months, suggesting strong interest for the asset class within these regions. Furthermore, 61% of investors outside Europe, North America and Asia are looking to commit fresh capital towards private real estate funds. European investors remain the most cautious as only 40% are looking to invest in the next 12 months. European investor appetite remains in a fragile state considering the on-going uncertainty in the Eurozone and recent regulatory changes and proposals.
Appetite among institutional investors for higher risk/return profile strategies seems to be prolific with 36% and 32% of investors believing opportunistic and value added funds respectively are presenting the best opportunities in the current market. Core vehicles are considered to be presenting the best opportunities by 34% of investors. North America is regarded by 68% of institutions as the most appealing region. Thirty-two percent of investors believe Europe is the region presenting the best opportunities in the current market.