By Karen Roman
Institutional target allocations to real estate are set to decline in 2025 after holding steady at 10.8% for two years, according to the Institutional Real Estate Allocations Monitor published by Hodes Weill and Cornell University.
Signs of recovery are emerging, with easing inflation and rate cuts expected to stabilize valuations, according to the report. Investors favor value-add and opportunistic strategies, particularly in the Americas, while interest in direct investments grows over funds, it stated.
“Despite persistent challenges in the market, commercial property price index data suggest that real estate valuation metrics have bottomed,” said Douglas Weill, Managing Partner at Hodes Weill & Associates. “As transaction volumes grow, we expect to see allocations start to accelerate in response.”
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