The non-listed real estate market continues to evolve. While the landscape and needs of investors are changing, managers are responding with a more diverse and sophisticated range of products.
Traditional managers are diversifying their offer and are joined by investors that are transitioning from deploying their own capital to providing third- party products, and while we also see real estate advisors moving into this space, the question is if we can expect occupiers to do the same thing.
This trend is partly down to the impact of technology, something that looks set to escalate. Technology isn’t only disrupting the way tenants use their real estate but also how that space is being provided. The rise of flexible office operators, highlighted in this edition of IQ, is one obvious example (see 'Giving flex offices due credit'.
Another important trend is investors’ widening perspective on real estate sustainability. This is moving towards a fully integrated approach to ESG, something that INREV will reflect in the formation of a new ESG Committee in 2019, combining the previous Corporate Governance and Sustainability committees (see 'ESG all under one roof').
Technology isn't only disrupting the way tenants use their real estate but also how the space is being provided
One aspect of the widening ESG approach is an increasing focus on the health and well-being of the end-user, or customers of the real estate – an approach that can help drive employee retention and productivity, two major concerns for tenants. Meanwhile, investors are starting to adopt impact investing in the real estate arena, addressing the potential impact real estate can have on its surrounding environment and society for the first time.
What else is in the INREV pipeline? For one thing, we will be paying special attention to debt funds (see 'The rise of European Debt Funds', which are continuing to thrive in current market conditions, as noted in this IQ. We are looking to extend our reach, provide more market information and develop our guidelines in this area – aims that will also be a focus for open end funds. We will continue the debate around pricing of open end funds and look forward to the launch of a European Open End Diversified Core Equity Fund consultation index coming soon.
But perhaps most importantly, I’d like to highlight the advent of the new INREV Asset Level Index (see 'A day to remember'). The launch of the index at this year’s Annual Conference in Venice is just the start for this game-changing project, which we fully expect to keep growing in coverage and use over the years to come. This big step towards boosting the transparency of our industry represents a great achievement for all those involved – and I would in particular like to thank the founding members and the focus group who have supported us along the way.