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Alternative and Real Assets: Building back better

Alternative Assets: Meeting the multiple demands of the post-pandemic world?

A low yield, low return environment may persist for some time, with alternative assets likely to be among the better performing asset classes over the next few years. Add to that some fundamental changes brought about by the coronavirus pandemic, particularly in real estate, and it is no surprise 'alts' and real assets are key portfolio considerations for many investors.

Among the papers we selected, several commentators look at the future of the real estate industry and the challenges to develop more technologically advanced, sustainable buildings. Private markets investment has also come into focus with the PE industry still grappling with the recent surge in SPAC deals. Meanwhile, President Biden's infrastructure plan and the EU’s ‘Green Deal’ put into perspective the question of how much needs to be invested to better meet the needs of 21st-century economies.

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Tomorrow’s Office: Safe, sustainable, scalable (PineBridge Investments, 2021)

Nick Waring of PineBridge Benson Elliott outlines the changes that have taken place in the office market since the coronavirus pandemic began. He illustrates how developers are adapting to attract the tenants of the future.

A Better Way to Build Private Market Portfolios (BlackRock, 2021)

For compliance reasons, this paper is only accessible in certain geographies

With their potential to enhance returns and help mitigate risk through diversification, private assets play an increasingly important role in institutional portfolios. Maximising their desired benefits can be a challenge as illiquidity, opaque valuations, limited data, and implementation hurdles make portfolio construction harder than it is with public market assets.

Private Credit Outlook (LGIM, Apr 2021)

For compliance reasons, this paper is NOT accessible in the United States and Canada

In this outlook piece, LGIM strategists look to the year ahead. Although they see a clear path to recovery, they also see several persistent headwinds.

Comparing 1920s Real Estate with the 2020s (Nuveen, Apr 2021)

In this paper, Nuveen compares the 1920s with the 2020s, two decades which saw significant social and economic upheaval. The authors observe what made the 1920s roar and examine the significant forces that will impact real estate investing in the next decade.

A Framework for the Future of Global Real Estate (WEF, 2021)

This World Economic Forum framework report outlines a vision in which the global real estate industry develops more sustainable and technologically advanced buildings.

Approaches to Benchmarking Listed Infrastructure (S&P Dow Jones Indices, 2021)

Analysts at S&P Dow Jones Indices highlight the attractions of listed infrastructure. To help investors who are unfamiliar with the asset class, they examine some of its intricacies.

Real Estate and Infrastructure for Income (Rockefeller Capital Management, 2021)

Rockefeller Capital Management looks at the attractions of real estate and infrastructure investing, with a particular focus on the income potential of both asset classes.

A Vision for 21st Century American Infrastructure (Brookings Institution, 2021)

This 100-page report from the Brookings Institution examines the risks and opportunities within the U.S. infrastructure sector in the decades ahead.

Farmland Plus: Investing in the agricultural value chain (Manulife IM, Apr 2021)

For compliance reasons, this paper is only accessible in certain geographies

Manulife Investment Management highlights the notion of 'farmland plus', a significantly wider investment universe than just pure farmland. Within 'farmland plus', value-add opportunities include processing and marketing.

Cryptocurrency: Bitcoin, blockchain, and institutional investors (Meketa, 2021)

Meketa notes the increasing interest in cryptocurrencies by investment institutions, but also points out specific risks of this asset class.

Global Hedge Fund Benchmark Survey (AIMA, 2021)

This AIMA survey finds the hedge fund industry in relatively robust health, with two-thirds of funds meeting or exceeding their own performance expectations. Demand from investors remains high, enabling the pressure on fees to abate slightly. Meanwhile, 60% of funds are integrating ESG into their investment processes.

The Short, the Index, and the Private Markets (Enterprising Investor, 2021)

This article from CFA Institute's Enterprising Investor blog examines the lack of a benchmark for unlisted private equity, which the author sees as a significant shortcoming.

How the SPAC Shockwave Will Shake Private Equity (EY, 2021)

EY investigates the unprecedented boom in SPACs (special purpose acquisition companies) and examines the implications for the wider private equity industry.

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