Share of capital raised for funds of funds doubles
The share of total capital raised for non-listed real estate funds of funds doubled in 2017, proving that the vehicle became more popular among investors due to its significant diversification options, according to the latest ANREV/INREV Funds of Funds study.
Last year saw in total US$160.2 billion of fresh equity raised for non-listed real estate, with US$8.5 billion or 5.2 per cent destined for funds of funds.
According to the study, funds of funds delivered positive returns across all styles, structures, regional strategies and size, with one in seven investors planning on increasing their allocations to funds of funds over the coming two years.
Across global strategies, funds of funds were the largest share of vehicles both by number and size, making up just under 50 per cent of the overall vehicles and representing 78.6 per cent of total net asset value.
They were followed by vehicles with a European strategy, representing 33 per cent, while those targeting the Asia Pacific represented 20 per cent.
The study also found that Asia Pacific funds of funds posted impressive returns of 15.1 per cent last year, which was a strong comeback from the -3.3 per cent recorded a year before.
Amélie Delaunay, director of research and professional standards at ANREV, said: “The scale of the returns in Asia Pacific in 2017 are significant, demonstrating their increasing appeal in the region.”
“The results generally reflect good health within the funds of funds segment, showing that they continue to offer smaller investors in particular an important diversification tool and the opportunity to create a nice blend of different funds.”
AUTHOR
Oksana Patron
Recommended for you
Regal Funds Management saw total net inflows of $2.1 billion during 2024, with flows primarily going into long/short equities and multistrategy vehicles.
There is growing divergence between institutional and retail investors in their enthusiasm towards equities, according to Bank of America, with retail sentiment being “unusually low” at the start of 2025.
A new co-portfolio manager has joined Tyndall Asset Management to help strengthen the performance of its small companies portfolio.
Natixis Investment Managers is set to merge with a global fund manager to create a multi-affiliate business with a combined $3.1 trillion in assets under management.
