Real estate investors and managers are increasing investments in newer property types that will benefit from the growth of the tech economy.
Investors in real estate investment trusts, for example, have more exposure to categories of properties such as cell towers and data centers that didn’t exist 20 years ago. Asset owners top-heavy with core properties have a smaller percentage invested in niche sectors, but even in core funds managers are filling out their small allocations to new construction of these niche property types that they expect will evolve into core real estate.
There is keen investor interest in data centers, cold storage or any property category that could benefit from the technology economy and might withstand moderation of economic growth, said Zachary Streit, Los Angeles-based senior vice president of George Smith Partners Inc., a real estate advisory firm that assists investors with financing and arranging real estate deals.
The economy has been in recovery for more than 10 years and investors are searching for alternative asset classes that might outperform traditional real estate sectors in a downturn, said Mr. Streit, who said he personally has arranged and closed more than $1 billion and underwritten in excess of $6 billion of debt and equity financings for real estate transactions.
Read the full article: Investors, managers go where the technology is (Pensions & Investments)
