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The Performance and Diversification Potential of Non-Listed Value-Add Real Estate Funds in Japan

Author

Listed:
  • Martin Hoesli

    (Geneva School of Economics and Management, University of Geneva, 1211 Geneva, Switzerland
    Business School, University of Aberdeen, Aberdeen AB24 3FX, UK)

  • Graeme Newell

    (School of Business, Western Sydney University, Locked Bag 1797, Penrith, NSW 2751, Australia)

  • Muhammad Jufri Bin Marzuki

    (School of Business, Western Sydney University, Locked Bag 1797, Penrith, NSW 2751, Australia)

  • Rose Neng Lai

    (Faculty of Business Administration, University of Macau, E22, Ave. Da Universidade, Taipa, Macao SAR, China)

Abstract

In the aftermath of the COVID-19 pandemic, non-core investments are gaining traction amongst institutional investors due to the shifting preference towards investment vehicles that position higher on the risk–return curve. Non-listed value-add real estate funds in Japan are one such vehicle. This research develops a comprehensive bespoke benchmark total return index using the ANREV database to reflect the performance of Japan-focussed non-listed value-add real estate funds. We compare the performance of such funds with that of other asset classes and perform portfolio and regression analyses. We conclude that there are several advantages to investing in those funds, including: (1) strong absolute total return performance, (2) competitive risk-adjusted performance, and (3) significant portfolio diversification potential in a mixed-asset portfolio context. The strategic implications for real estate investors are also assessed.

Suggested Citation

  • Martin Hoesli & Graeme Newell & Muhammad Jufri Bin Marzuki & Rose Neng Lai, 2022. "The Performance and Diversification Potential of Non-Listed Value-Add Real Estate Funds in Japan," JRFM, MDPI, vol. 15(5), pages 1-16, April.
    • Handle: RePEc:gam:jjrfmx:v:15:y:2022:i:5:p:198-:d:800090
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    References listed on IDEAS

    as
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