Dispersion in returns
Published annually
Welcome to INREV’s Return Dispersion Insights, a new annual publication that looks at how individual asset returns differ within European non-listed real estate. Drawing on the INREV Asset Level Index, it covers the residential, office, industrial/logistics and retail sectors across Europe overall, the Netherlands, the UK, Germany and France. Even within the same market and sector, asset performance can diverge sharply, and understanding the drivers and the level of performance dispersion has important implications for investment strategy.
Where return dispersion is high and persistent, active asset selection can be an important source of outperformance and risk management. In more compressed markets or sectors, broad market positioning may have a greater influence on portfolio outcomes. The appropriate balance between these approaches should, therefore, be calibrated to the characteristics of the relevant sector, geography and stage of the market cycle rather than applied uniformly across a portfolio.
Key highlights:
- Office recorded the highest average return dispersion of any sector (2,700 bps) and residential the lowest (1,900 bps), with industrial/logistics and retail in between.
- The United Kingdom showed the widest spread among the geographies analysed (2,600 bps). The Netherlands had the most compressed distribution (2,100 bps).
- Dispersion widened sharply around market turning points, most notably during the post-2022 repricing and the subsequent recovery. Top performing assets tend to rebound earlier and faster, while weaker assets stay under pressure.
Related Products
Asset Level Index
The INREV Asset Level Index measures the performance of European real estate assets and includes assets that are reported on a monthly, quarterly, semi-annual and annual basis. More detailed insights can be obtained through the dedicated analytical tool.
Market Insights
Market Insights is a research snapshot aggregating views from the membership to assess the dynamics and business-oriented implications for the non-listed real estate industry. This report draws data from the INREV European indices and surveys, including the Consensus Indicator, Asset Level Index, INREV Fund Index and more.