What happened
Mark Lee, head of real estate at the $370 billion Australian Retirement Trust, cautioned that investors incorrectly treated real estate as an easy asset class during the pandemic downturn. Lee, who manages a $20 billion property portfolio expected to double in five years, noted physical assets require constant upkeep.
Why it matters here
Elevated borrowing costs and shifting property valuations have dragged down institutional returns. Australian investors allocating capital to unlisted real estate must evaluate ongoing capital expenditure requirements and active management capability rather than relying solely on long-term lease terms to generate yield.
What to watch
ART real estate acquisitions and portfolio valuation announcements as the fund expands its unlisted property footprint.
Source
investmentmagazine.com.au