Institutional property portfolios averaging 10.9 per cent annual return

Institutional real estate portfolios have generated an average investment annual return of 10.9 per cent over the past three years, with annual returns increasing substantially year-over-year since 2012.

That’s according to the third annual Institutional Real Estate Allocations Monitor (the 2015 Allocations Monitor) by Cornell University's Baker Program in Real Estate and Hodes Weill & Associates.
The 2015 Allocations Monitor focuses on the role of real estate in institutional portfolios, and the impact of institutional allocation trends on the investment management industry. Founded in 2013, it is a comprehensive annual assessment of institutions' allocations to, and objectives in, real estate investments that analyses trends in institutional portfolios and allocations by region, type and size of institution. 
According to the 2015 Allocations Monitor, target allocations continue to increase, albeit at a moderating pace, while Investors remain significantly under-invested in real estate. Institutions are increasingly concerned about asset pricing, rising interest rates and geopolitical risks. While appetite for core remains robust, investors are increasingly emphasising value-add strategies.
Institutions in APAC meanwhile, are focused on cross-border investments, while institutions in the Americas and EMEA continue to prioritise their home markets. Institutions everywhere remain cautious about allocating capital to emerging markets, given global market and currency volatility, an overall flight to safety and commodity price fluctuations, while ESG plays a more prominent role in the investment process for institutions in EMEA relative to institutions in APAC and the Americas.