New research from German investment manager Catella suggests that new real estate vehicles, including exchange-traded funds (ETFs), real estate secondaries and real estate multi-manager funds are growing in popularity, citing a survey conducted with multi-asset managers in Germany.
The report, 'Strategic real estate allocation – on its way into new product dimensions?', talked to 100 multi-asset managers in Germany about their real estate allocation strategies for the coming months and years, in the context of Germany's booming property market.
'Expansion towards the vehicles of real estate secondaries, and ETFs in the past 20 months seem to be more than a vision,' said Dr. Thomas Beyerle, Catella's head of group research.
57% of the asset managers surveyed expect an appearance of real estate ETFs on the German market in 2019–2022, while only 13% said they didn't expect a positioning of this product.
According the research, real estate secondaries and real estate multi-manager funds seem to be a likely future investment option. Of those surveyed, 20% would invest 4–6% in real estate secondaries, while 7.7% would invest in multi-manager funds.
Private equity investments would also profit from an adjustment if key interest rates rise, and would take an additional 10% share of investor allocation, according to the survey. The yield expectation is beyond 10%.
Those surveyed said that ETFs experience an adjustment of 5% in asset allocation, and could record an average yield of 3%.
The complete market tracker is available at catella.com/research.
