Unlisted property trade association Inrev says global real estate funds of funds saw their assets under management rise to €43.4 bn in 2020.
Inrev, which teamed up with Asian and US counterparts Anrev and Ncreif for the Fund Manager study, said the figure highlighted investor interest in being able to commit capital to a fund manager whose function is to select third party managers to invest with.
Funds of funds with a core style make up almost half (48%) of the universe by number, but 94% of total NAV.
Core style funds of funds tend to be large with an average NAV of €1.8 bn. However, the three largest core style funds of funds have an average NAV of around €5.5 bn representing 78% of the total value of the Funds of Funds Universe.
Value added funds of funds account for just 5% of total NAV, with an average NAV of €112 mln per vehicle.
Funds of funds with an opportunity investment style make up the remaining 1%, with the average NAV per vehicle being €89 mln.
In the 2021 Funds of Funds Study, core style funds of funds outperformed non-core for the fourth time in the last five years, with returns of 1.9% and -3.1% respectively in 2020. On average, funds of funds with a core style invest in 25 managers.
This is more than double the equivalent number for non-core vehicles, which on average select 10 managers ranging between a minimum of six and a maximum of 17.
