The Weekly Take from CBRE
New Slang: A deep dive into secondary investment vehicles
Aug 26, 2024
Jarrett Vitulli, an expert in secondary transactions from Evercore, and Achal Gandhi from CBRE Investment Management dive into the world of indirect real estate investing. They discuss how secondary transactions can enhance returns with lower risks, offering opportunities to acquire properties at discounts. The conversation touches on the expanding secondary market, particularly in logistics, multifamily, and healthcare sectors. They also explore the liquidity challenges and strategic advantages these transactions provide to institutional investors.
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Quick takeaways
- Secondary transactions in real estate provide opportunities for higher returns at lower risk by acquiring discounted portfolios without property-level exposure.
- The growth of the secondary real estate market, driven by liquidity needs and investor engagement, is reshaping traditional investment strategies and portfolio management.
Deep dives
Understanding Indirect Investing
Indirect investing refers to investing via an operating partner instead of directly managing the assets. This approach allows investors to leverage the expertise of specialized partners who focus on specific themes, such as logistics or student accommodations, in different geographic regions. By capitalizing on the skills of these operating partners, investors can gain exposure to diversified real estate investments without the complexities of daily asset management. This method opens up unique avenues for university investors who can participate in real estate without committing to direct ownership.
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