The Weekly Take from CBRE Tomorrow Is Today: What is the future of core funds?
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Oct 6, 2025 John Lippmann, Head of U.S. Real Estate Capital Markets at Barings, and Elisabeth Troni, Portfolio Manager for CBRE Investment Management, dive into the evolving landscape of core funds. They explore how alternatives like data centers and seniors housing are increasingly reshaping portfolios. The conversation highlights the importance of operational expertise and the strategic advantages found in emerging secondary markets. They also discuss the need for flexible fund structures to navigate market cycles and maximize returns.
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Core Funds Follow Market Transaction Flow
- Core funds are expanding into alternatives because transaction volume in those sectors has grown and offers attractive risk-adjusted returns.
- John Lippmann and Elisabeth Troni say investors must adapt fund strategy as markets change to capture available opportunities.
Partner With Operational Specialists
- Lean into specialist operators when investing in operationally intensive sectors like seniors housing or data centers.
- Elisabeth Troni recommends partnering with niche intermediaries to manage unfamiliar operational demands.
Operational Alpha Is Now A Core Requirement
- Operational alpha has become necessary for core funds to outperform benchmarks as lease terms shorten and service models matter more.
- Both speakers stress that operations now critically drive value alongside location and asset quality.