MSCI Blog: Open- vs. Closed-End Real Estate Funds: How the Choice Mattered

• The aggregate performance of closed- and open-end real estate funds in the U.S. was strikingly similar in recent years, despite large differences in their strategic focus and the roles they play in institutional portfolios.
• How investors timed their commitments to closed-end funds, as well as how managers drew down and returned capital to investors, contributed toward money-weighted returns that were 2 percentage points higher than their equivalent time-weighted returns.
• Performance dispersion across closed-end funds created opportunity for investors able to select top-quartile managers, but even those making a large number of commitments potentially faced a wide range of portfolio returns.

• The aggregate performance of closed- and open-end real estate funds in the U.S. was strikingly similar in recent years, despite large differences in their strategic focus and the roles they play in institutional portfolios.
• How investors timed their commitments to closed-end funds, as well as how managers drew down and returned capital to investors, contributed toward money-weighted returns that were 2 percentage points higher than their equivalent time-weighted returns.
• Performance dispersion across closed-end funds created opportunity for investors able to select top-quartile managers, but even those making a large number of commitments potentially faced a wide range of portfolio returns.

To Read More visit: https://www.msci.com/www/blog-posts/open-vs-closed-end-real-estate/02413249714