BEFORE 1980, COMMERCIAL real estate was invisible in institutional
investment portfolios. More recently considered an “alternative
investment,” today’s institutional investors typically allocate an average
of almost 10 percent of their portfolios to real estate, which continues
to gain a foothold among limited partners, with enduring implications
for the industry. Has real estate joined the big three institutional
asset classes — stocks, bonds and cash — as a permanent fourth asset
The Standard & Poor’s Dow Jones Indices recently concluded that real
estate is due an upgrade and will elevate it from a subsector under
“financials” to one of 11 sectors within its Global Industry Classification
Standard (GICS), effective with the market close on August 31, 2016.
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