Private real estate investments are ownership stakes in properties that have the potential for income generation and/or capital appreciation. Private market real estate investments can be attractive for investors in search of better returns, as well as those seeking a robust stream of income. Real estate can offer predictable cash flows, low correlation to other asset markets, relatively low volatility and a large investment universe.


Types of real estate investments





Potential benefits of real estate investments




The potential for private equity returns


Real estate can offer net returns of 8-11% when backed by a strong and consistent track record.



Highly-diversified cash flows


Real estate offers a diversified income stream from leases and ancillary income.



Potential for alpha-generation


Robust due diligence and manager selection can help identify the best ideas with the highest long-term potential.




Three main categories we address with real estate investing


  • Thematic-driven strategies, primarily driven by demographics and consumer behavior
  • GDP-driven strategies, influenced by the economics of the region
  • Event-driven strategies, influenced by larger phenomena like the pandemic or weather events.



Our approach identifies three areas for return generation




Secular trends

 

Capitalize on growth profiles with an emphasis on thematic trends:

 

  • Demographics
  • Technology
  • Healthcare
  • Evolving consumer
  • Urbanization, population growth and migration
  • ESG.

Dislocations

 

Valuation anomalies caused by temporary dislocations:

 

  • Public-to-private arbitrage
  • Distressed investments
    • distress caused by macroeconomic cycles i.e. COVID-19, travel and leisure
    • Capital structure distress.

We construct unique, diversified, downside protected portfolios that produce stable growth across cycles.




We have been helping clients with real estate investments for over 20 years’. Talk to us to see how we could help you.


Contact a Mercer specialist

We’re eager to speak with you. Please provide your details below.

*Required Fields

 

Important legal information for investors

 

1 Source: PitchBook, Bloomberg, National Center for the Middle Market.

2 As of June 30, 2021.

 

About Mercer’s assets under management and advisement figures

 

The assets under advisement data (AUA Data) reported here include aggregated assets under advisement for Mercer Investments L LC and their affiliated companies globally (Mercer). The AUA Data have been derived from a variety of sources, including, but not limited to, third-party custodians or investment managers, regulatory filings, and client self-reported data. Mercer has not independently verified the AUA Data. Where available, the AUA Data are provided as of the date indicated (the Reporting Date). To the extent information was not available as of the Reporting Date; information from a date closest in time to the Reporting Date, which may be of a date more or less recent in time than the Reporting Date, was included in the AUA Data. The AUA Data include assets of clients that have engaged Mercer to provide ongoing advice, clients that have engaged Mercer to provide project-based services at any time within the 12-month period ending on the Reporting Date, as well as assets of clients that subscribe to Mercer’s Manager Research database delivered through the MercerInsight® platform as of the Reporting Date.