THE EFFECT OF NEW INVESTMENTS ON THE COST OF MATERIAL AND ENERGY IN THE SERBIAN ECONOMY

Real estate is an important investment asset class for Australian retail and wholesale funds yet there are considerable problems associated with choosing the optimal allocation of real estate in a portfolio. This asset class poses considerable problems for portfolio managers because of reliance on appraisals in valuing direct real estate investment and the equity like behaviour of listed Australian real estate investment trusts (A-REITs). The focus of this paper is the analysis of direct investment in commercial real estate, direct investment in residential real estate as well as indirect investment through the ASX 300 A-REIT index using quarterly returns over the period from the 3rd quarter 1986 to the 3rd quarter 2009. Analysis is conducted on the relations that exist between the three classes of real estate investment as well as between the share market returns and real estate investment. Diversification benefits can be achieved with investment in real estate investment, particularly direct investment in residential real estate.

Co-EditorG. Stacy SirmansCollege of BusinessFlorida State UniversityTallahassee, FL 32306 1042904-644-82 14 904-644-4077 (FAX)This section of the Journal publishes reviews on textbooks, professional books, and other scholarly books appropriate to real estate. Areas of interest include, but are not limited to, mortgage markets, real estate investments, real estate finance, asset/property management, real estate development, corporate real estate, valuation, and other areas related to real estate. If you have an interest in reviewing a particular book or if you wish to be considered as a reviewer, please contact the Co-Editor at the address noted above. A list of new books follows the book reviews; both are arranged alphabetically by author.Associate EditorsJohn D. Benjamin Mark J. EppliThe American University George Washington UniversityH. Glenn Boggs Andrea J. HeusonFlorida State University University of MiamiA. Quang Do John R. KnightSan Diego State University University of the PacificMajor, John B., with Pan, Fung-Shine (Eds.), Contemporary Real Estate Finance: Selected Readings, Prentice Hall, 1996.406 Pages.The editors have compiled an excellent selection of articles by numerous real estate experts, many of whom are noted authorities in the field of real estate. That speaks volumes about this collection of readings. The text contains twenty-seven readings of historical interest and state-of-the-art studies. These readings can be used as a supplement in upper-level undergraduate or graduate real estate finance and investment courses. It is also an ideal source of readings for undergraduate and graduate real estate seminar courses.The articles in Part 1, Introduction, focus on the development of real estate investment analysis, critical issues in real estate investment analysis and real estate portfolios. The first article, by Austin J. Jaffee and C. F. Sirmans (AREUEA, 1984), provides a review and analysis of the past, present, and future of research on real estate financial decisions. Some of the unresolved issues in real estate investment analysis such as Real Estate as an Investment, Investor Objectives, and Taxation Environment are discussed. The authors posed excellent questions for future research. It is not surprising that some of the issues remain unresolved in 1996; consequently, this article not only provides the historical development of the theory of real estate investment analysis but also presents a research agenda for the future. The timeliness and relevancy of their research agenda are reflected in subsequent articles in this text and in the body of research published since the mid- 1980s.98 BOOK REVIEWSThe second article in Part 1, Real Estate: The Whole Story by Paul M. Firstenberg, Stephen A. Ross, and Randall C. Zisler (1988), applies modern portfolio theory to real estate asset selection. The authors contend that investors should examine equity real estate investments not only on their individual merits but also for their impact on the investors overall real estate portfolio. The two modern portfolio techniques used in this paper are the capital asset pricing model (CAPM) and the arbitrage pricing theory (APT). The authors demonstrate that these techniques are just as applicable to real estate portfolio management as to security portfolio management. Their intention is to show how pension funds and other large investors can use modern portfolio techniques both to construct real estate portfolios and to allocate funds to asset categories including real estate. They begin their work by comparing total real estate returns to returns on stocks and bonds to show that real estate is an attractive asset category relative to stocks and bonds. This article provides an excellent review and application of modern portfolio theory for both undergraduate and graduate students. …

Office is one of the core sectors within the buildings sector, attracting tens of billions of dollars in global real estate investment flows. Most of these are achieved through non-listed investments, where office real estate represents one of the major sectoral investment exposures for many global institutional real estate investors and investment managers. The rising interest rates in recent years have been a significant concern, impacting the global real estate markets significantly. Based on these premises and by using quarterly total returns of non-listed office real estate across the US, UK, Germany, Canada, and Australia from June 2008 to June 2024, this research assesses the risk-adjusted performance and portfolio diversification benefits of non-listed office real estate across the five markets over both interest rate cut and interest rate hike cycles. The results empirically validate the added-value role of non-listed office real estate in institutional multi-asset portfolios across the UK, Germany, Canada, and Australia during the interest rate hike cycle preceding the COVID recession. In the 10% capped real estate allocation, the average allocation was 0.7% in the UK, 0.4% in Germany, 0.7% in Canada, and 9.1% in Australia. Over the interest rate hike cycle after the COVID recession, Australian non-listed office real estate offered enhanced benefits as part of the multi-asset portfolio, constituting an average of 0.8% in the capped real estate allocation. In the global non-listed office real estate portfolio, the US dominated the portfolio across varying interest rate cycles, with an average allocation of approximately 65%. The average allocation to Australia was 24.2% over the interest rate hike cycles, while the average allocation to Germany was 32.0% over the interest rate cut cycles. These findings offer institutional real estate investors and investment managers critical and practical insights into how the investment performance and portfolio construction strategy of office assets—an essential component of the buildings sector and a major non-listed real estate investment exposure for global institutional real estate investors—respond to macro-financial and interest rate cycles. The investment implications of the findings are also discussed.

The author describes in the article that the deterioration of the economic situation in Ukraine due to hostilities causes the need for careful analysis, planning and finding ways to attract investments in the field of residential real estate. The destruction of a large part of the housing stock, a significant volume of internal migration of the population due to the loss of housing in the territories primarily close to active hostilities, acutely raises the issue of analyzing and improving the existing mechanisms of investing in residential real estate in order to find new investors in the middle of the country and from abroad. The author considered the essence and features of investing in residential real estate in Ukraine. The current legal documents regulating the sphere of infestations in residential real estate are considered and the main sources of investments are given in accordance with the current legislation. The main goals of investors and the main subjects of the residential real estate market have been determined. It is emphasized that a significant share of investments in residential real estate is occupied by institutional investors. The classification of the main forms of investment in real estate according to the principle of building capital (on the basis of equity, loan and mixed capital) is presented. The main financing mechanisms for residential real estate objects have been identified: construction financing funds, issuance of targeted bonds, real estate transaction funds, joint investment institutes; their features are investigated, the main advantages and disadvantages are highlighted in relation to the financial security of the investor and from the side of the regulator - the state. Considered a fairly popular nowadays, but not regulated by law, method of investing in real estate - an investment contract with a developer; its risks are emphasized. It is noted that the risk of loss of real estate or invested own monetary assets always remains with the investor, regardless of the type of investment mechanism.

Purpose Environment, social, governance (ESG) has taken on increased importance in real estate investment in recent years, with benchmarking ESG being critically important for more informed real estate investment decision-making. Using 60 stakeholder interviews with senior real estate executives, this paper examines the strategic issues regarding benchmarking ESG in real estate investment; specifically, identifying areas going forward where ESG benchmarks need to be improved. This includes the issues of granularity, climate resilience and climate risk, as well as an increased focus on outcomes and performance, and using best practice procedures in delivering ESG in real estate investment.Design/methodology/approachIn total, 60 stakeholder interviews were conducted with key real estate players globally to assess the use of ESG benchmarking in real estate investment at various levels (asset/fund-level, listed real estate, delivery, reporting and internal benchmarking), across regions and across different types of real estate investment players (real estate fund manager, real estate investment trust (REIT), institutional investor and real estate advisor). This enabled key strategic insights to be identified for improved ESG benchmarking practices in real estate investment going forward.FindingsThere was clear evidence of the need for improved benchmarks for ESG in real estate investment. More focus was needed on performance, outcomes and impacts, with a stronger focus on granularity around the issues of climate resilience and climate risk. Improvements in Global Real Estate Sustainability Benchmark (GRESB), as well as increased attention to Task Force for Climate-Related Financial Disclosures (TCFD) were seen as important initiatives. Clear differences were also seen in the use of these ESG benchmarks on a regional basis; with Australia and Europe seen as the world leaders. These strategic stakeholder insights regarding ESG saw the development of best practice guidelines for the more effective delivery of ESG benchmarks for more informed real estate investment decision-making, as well as a series of recommendations for improving ESG benchmarking in real estate investment.Practical implicationsESG benchmarking is a critical area of real estate investment decision-making today. By utilising stakeholder interviews, the strategic insights from key players in the real estate investment space are identified. In particular, this paper identifies how the current ESG benchmarks used in real estate investment need to be improved for a more critical assessment of climate resilience and climate risk issues at a more granular level. This enables the identification and delivery of more effective ESG best practice procedures and recommendations for improving ESG benchmarking in real estate investment going forward. These issues have clear impacts on ongoing capital raisings by investors, where benchmarking ESG is an increasingly important factor for real estate investors, tenants and real estate asset managers.Originality/valueBased on the stakeholder interview responses, this paper has identified key areas for improvement in the current benchmarks for ESG in real estate investment. It is anticipated that an increased focus on technology and the availability of more granular data, coupled with user demand, will see more focus on assessing performance, outcomes and impacts at a real estate asset-specific level and produce a fuller range of ESG metrics, more focused on climate resilience and climate risk. This will see a more effective range of ESG benchmarks for more informed real estate investment decision-making.

PurposeThis paper examines the current uncertainty within real estate markets through the quotes of Dr. James A. Graaskamp, a real estate educator and researcher. Graaskamp focused his teachings on real estate investment through the lens of risk management and risk mitigation. Using the current COVID 19 pandemic crisis as the backdrop, the author examines how we might learn from Graaskamp to look differently at real estate investments during these uncertain times when an external shock shakes a market, causing transactions to stall and sometimes freeze. In addition, she explores how we might learn from today's situation and make long-term changes to our built environment to have a better understanding of the risks associated with the current but also future pandemics and other uncertainties including natural disasters or climate change. The quotes were gathered by Jim Curtis, a student, friend and colleague of Dr. Graaskamp from the late 1970s until his death in 1988. Through these quotes, the author explores the many facets of the complex nature of the real estate asset class particularly during these very uncertain times created by the global pandemic.Design/methodology/approachThis is a thought piece on the current uncertainty surrounding real estate markets around the globe caused by the COVID 19 pandemic. The author of this essay was also a student, friend and mentee of Jim Graaskamp's, so it is an oral history of her experiences with this well-known and iconic real estate educator and scholar.FindingsAs a discussion piece, this is not a traditional research project with empirical findings. It is an exploration of the current uncertain times caused by the COVID 19 pandemic and its impact on real estate markets. The author examines how the increased risk is currently, and will also continue to, significantly influence the fields of property investment and finance.Practical implicationsThe James A. Graaskamp Collection on Teaching Materials compiled by the Wisconsin Real Estate Alumni Association is not a widely recognized resource for real estate scholars and practitioners yet the two CDs contain a wealth of information and knowledge from an intelligent real estate expert. Used as the base for the discussion, this paper sheds light on the teachings and writings of Dr. Graaskamp. It illustrates the usefulness of the materials for other researchers and educators. In particular, it highlights Graaskamp focus on risk management and mitigation which he strongly believed were essential skills to understanding the complicated nature of a real estate investment and for making good investment decisions, particularly when markets are full of uncertainty as is the case during these current times of the global COVID 19 pandemic.Originality/valueAs one of only a handful of living and still practicing doctoral students of Professor Graaskamp, the author has a unique perspective and lens to attempt to interpret the quotes of this real estate expert. He was a leader in real estate education, particularly as it pertains to real estate valuation, feasibility and investment, and this essay draws out some of his more important lessons from his pithy and often humorous quotes.

PROLOGUE: Urbanisation in the face of globalization is embraced as a facilitator of dynamic real estate development and investment with the target aim of boosting the socio-economic status of the people. Caution is needed to correlate the dividends of economic growth of each economy with the millennial dynamics in real estate investment standards in order to guarantee the sustainability of both sectors. Deviation from this focus is a possible disastrous end to real estate suitability for the next level of world class environment.PURPOSE: This paper shall examine the government’s globalization strategy and the prevailing challenges and its effects on the sustainability real estate investment in Nigeria. This is with the view to proposing effective approach to improving her input standard on housing investments.DESIGN/METHODS FOLLOWED/APPROACH: The study shall take a quasi-exploratory survey approach to elicit relevant data necessary for the improving the nation’s economic status via the real estate investment dynamics. The appropriate probability sampling approaches shall be adopted in a multistage sampling system used to elicit data from some renowned real estate firms, Architectural/ Construction firms.FINDINGS: Findings shall focus on Nigeria’s adopted strategies of the government to achieving economic growth; her contribution to real estate investment and compliance with world class standard in development. It shall investigate whether the concept of sustainability is incorporated in Nigeria’s real estate investment strategy to globalization program. The predictive outcome of her prevailing strategy shall be identified based on the research results.ORIGINALITY: Outcomes of this study shall served as a warning guide to the various tiers of the Nigerian government towards prioritizing sustainability of strategic real estate investments and development in their struggle to achieving globalization.

Investment in real estate is a zoning issue as the real estate market is closely related to economic development and trends in real estate market are considered to be indicators of trends in the whole economy of the country. The goal of this paper is to analyse the main aspects and considerations when investing in real estate, evaluate investment in real estate situation in different EU and non-EU countries and introduce MCDM methods that could be used for selecting a state for investment in real estate. It is identified that when investing in real estate various political, social, economic, environmental and other factors have to be taken into consideration. Analysed examples of EU (Lithuania, Romania, UK) and non-EU (Turkey, China, Russia) countries show different risks and opportunities for investments in real estate. MCDM methods are applicable to evaluate which countries are most attractive for investment in real estate. Described TOPSIS and ARAS methods could be used for assessing states as alternatives when selecting where to invest

PurposeOpportunity real estate funds are an important style of real estate investing for institutional investors seeking nonlisted real estate exposure. Importantly, institutional investors have sought exposure to the China real estate market, often via opportunity real estate funds. This has been by a pure China opportunity real estate fund (100% China opportunity real estate) or by a pan-Asia opportunity real estate fund where China opportunity real estate was part of this pan-Asia opportunity real estate portfolio. Using two bespoke China opportunity real estate indices developed by the authors, this paper aims to assess the risk-adjusted performance and portfolio diversification benefits of China opportunity real estate in a mixed-asset portfolio over 2008–2020. It also highlights critical issues for institutional investors going forward to factor into their real estate investment decision-making for effective China real estate exposure.Design/methodology/approachThis paper develops two bespoke China opportunity real estate fund performance indices to assess the risk-adjusted performance and portfolio diversification benefits of China opportunity real estate funds in a mixed-asset portfolio over 2008–2020. An asset allocation diagram is used to assess the role of China opportunity real estate in a mixed-asset portfolio via both the non-listed and listed real estate investment channels.FindingsOver 2008–2020, China opportunity real estate exposure via pan-Asia opportunity real estate funds were seen to outperform pure China opportunity real estate funds. In both formats, China opportunity real estate funds were seen to have a significant role in a China mixed-asset portfolio across most of the portfolio risk spectrum; particularly compared to listed real estate exposure in China. On-going issues regarding real estate risk management in China will take on increased importance for institutional investors seeking China real estate exposure.Practical implicationsOpportunity real estate funds are an important style of real estate investing, often used by institutional investors to gain non-listed real estate exposure in a developing real estate market. This style of real estate investing has been popular with institutional investors seeking exposure to China real estate as part of the China economic growth dynamic. The results of this research highlight the importance of opportunity real estate investing in China, both via a pure China opportunity real estate fund and via a pan-Asia opportunity real estate fund. Based on this empirical analysis, China opportunity real estate exposure is seen to be more effective via a pan-Asia opportunity real estate fund than a 100% China opportunity real estate fund. A range of practical China real estate investment issues are also highlighted for the effective delivery of China real estate exposure for institutional investors going forward; this particularly relates to the on-going risk management for real estate investment in China.Originality/valueThis paper is the first empirical research analysis of the risk-adjusted performance of China opportunity real estate and its role in a mixed-asset portfolio. Using bespoke China opportunity real estate fund indices developed by the authors, this research enables empirically-validated, more informed and practical opportunity real estate investment decision-making regarding the strategic role of China opportunity real estate in an institutional investor's portfolio. It also highlights the importance of various facets of real estate risk management in China going forward.

PurposeWithin the context of ESG (Environment, Social and Governance), environmental sustainability has taken on increased global importance in recent years. Similarly, real estate investment managers in developing their global real estate investment portfolios need a fuller understanding of the ESG and environmental sustainability dimensions of these global real estate markets for more informed real estate investment decisions. Using the JLL GRETI sustainability sub-index, this paper examines the environmental sustainability transparency status of 99 global real estate markets over 2016–2020 and explores various strategic issues regarding ESG and environmental sustainability; particularly the critical issues relating to climate risk mitigation, climate resilience and zero-carbon. The current status of environmental sustainability in these 99 real estate markets is assessed, with areas for “best practice” improvement identified to the benefit of real estate investment managers; particularly the improvements needed in ESG to support real estate investment in the emerging real estate markets.Design/methodology/approachThe JLL GRETI sustainability sub-index is analysed to examine strategic issues relating to environmental sustainability transparency. 99 real estate markets are assessed globally for a range of critical ESG issues over 2016–2020. Differences between the developed and emerging real estate markets are highlighted.FindingsConsiderable variation was seen in the ESG and environmental sustainability practices, procedures and frameworks across these 99 real estate markets. This was particularly evident amongst the emerging real estate markets. Compared to the other five dimensions for real estate market transparency, environmental sustainability was seen to be well behind these other dimensions in most markets. Progress has been made in recent years, but it has been slow and steady rather than at a dynamic level. Clearly, more is needed globally to enhance the stature of environmental sustainability in the context of an increasing focus on ESG and specifically on climate risk mitigation, climate resilience and zero-carbon in real estate investment.Practical implicationsWith ESG and environmental sustainability taking on increased importance across the international real estate markets, it is important that real estate fund managers have a full understanding of the ESG and environmental sustainability status of these real estate markets where they may be considering real estate investment opportunities; this includes both the developed and emerging real estate markets. This is essential to ensure future capital raising for new funds, as well as supporting the global ESG agenda by the real estate investment community. Specific strategies are also identified for emerging real estate markets to improve their environmental sustainability practices and ESG status.Originality/valueThis is the first paper to use the JLL GRETI sustainability sub-index to assess the environmental sustainability status of 99 real estate markets globally; providing strategic insights for real estate investment managers as they develop their global real estate portfolios and more fully embrace the challenges of ESG and environmental sustainability in the real estate space going forward. Specific strategies are clearly identified for all markets to improve their environmental sustainability ratings to the benefit of both global real estate investment and the broader communities.

The paper analyses the characteristics of institutional investments in the German real estate market and refers to the study of “Institutional Investors in Real Estate” presented by Prof. Dr. Wolfgang Schaefers at the 1st World Congress of the International Real Estate Society in Anchorage (July 2001). In addition, the study identifies and evaluates current aspects and future trends in institutional investments in real estate – taking into account the specific institutional governance structure in Germany. More specifically, the paper will analyse general insights into the investment behaviour and investment criteria of German and international institutional investors in real estate as well as the volume of real estate investments. Thereafter, the study focuses on the behaviour of German institutional investors and their tendency to convert direct real estate assets into indirect real estate investments. This possible conversion is evaluated in regards to new investment forms such as mortgage/asset backed securities, real estate private equity/opportunity funds and fund of funds products as well as the likely introduction of real estate investment trusts (REITs) in Germany, but also in regard to the actual crises at the openended real estate fund market in Germany. In particular, the study focuses on the investment objectives in the different real estate markets as well as on the risk objectives and preferred vehicles and strategies for future investments in real estate. Finally the study will determine the importance of different valuation methods for real estate assets and conclude with a general outlook of future strategies and tendencies in institutional investments in real estate.

Purpose: This study aims to examine the impact of inflation on key variables of real estate investment performance and investment decisions. Theoretical Reference: This paper considers several models of real estate investment performance indicators because the effect of inflation on key variables of real estate investment performance is an important factor in investment decisions. Since effective investment decision is key to avert investment loss especially during inflation period, this paper follows the suggestions by Otegbulu (2022) and Georgiv, et al (2002) that property incomes and values are not static during periods of inflation bur responds to economic dynamics, and could infact trigger favourable investment opportunities in real estate. This paper therefore follows these models/suggestions of Otegbulu (2022) and Geoargiv, et al, (2002) to examine several real estate investment to offer appropriate reflection of how inflation impacts of incomes from real estate investment. Method: Data collected were analysed using Pearson Correlation Analysis to determine the relationship between inflation rate and real estate investment performance (measured by annual returns). Regression analysis was also employed on the data to determine the level of contribution or degree of impact of inflation on real estate performance. Also data collected on the exchange rate and real estate performance over the study period were analysed using Pearson Correlation Analysis to determine the relationship between exchange rate and real estate investment performance (measured by annual returns on investment). Regression analysis was also employed on the data to determine the degree of impact of exchange rate on real estate investment performance. Data collected for the analysis and hypotheses testing were secondary data over a period from 2005 – 2022. Result: The study reveals that real estate investment market generates average total annual returns of 21.39% under average inflation rate of 12.5%. The test statistics (Pearson Correlation) results shows that the higher the inflation rate, the lower the performance of the real estate investment. Also, the study reveals that as inflation persists causing exchange rate fluctuations, the test statistics (Pearson Correlation) results shows that higher exchange rate causes lower performance of real estate investment. This could be because more than 90% of the real estate construction materials in the study are imported. Conclusion: It is clear and obvious that inflation impacts highly on real estate and capable of distorting projections in property investment. Rational investors must therefore factor in inflation risk in investment decisions. The study has shown that inflation has significant impact on annual returns of real estate and consequently affects investment performance. The study concluded that the higher the inflation, the lower the performance of the real estate investment and that the continuous rise in inflation rate reduces the purchasing power of the local currency leading to local currency devaluation. Also, it was concluded that higher exchange rate causes lower performance of the real estate in terms of annual returns. Research Implications: One of the major implications of the findings from this study is that as inflation raises the volatility of local currency which adversely affect the cost of construction, real estate investment performance is hindered. The risk element increases which could lead to project cost over-run, abandonment or increased vacancy rate. Investors become skeptical in making investment decisions because of uncertainties. Policy makers should put in place policies and guidelines that will attract cross-border investors who can take advantage of the local currency devaluation to improve their real estate investment portfolios. Originality/Value: The relationship between inflation rate, exchange rate and real estate performance (measured by rate of returns on the investment) is of great concern for real estate practitioners and investors. The study is original well thought efforts of the authors as contribution to real estate practice and education in developing economies currently being threatened by rising inflation. It is believed that this study will be very useful to global investors who will like to invest in the study area in particular and other emerging markets in general.

International real estate investment refers to any investment portfolios or strategies that include real estate from different countries. These portfolios can be mixed with other asset classes such as stocks and bonds, or invested only in real estate. Perhaps the most common reason for including international real estate assets in an investment portfolio is risk reduction through geographic diversification, although its viability and effectiveness are sometimes challenged. The chapter later provides a discussion of other arguments for and against diversification using real estate.Another important issue is how to invest in foreign real estate markets. In general, real estate can be divided into direct real estate (DRE) and indirect real estate (IRE) investment. Direct real estate refers to the direct ownership and operation of real property assets such as houses, shopping centers, hotels, and offices. Indirect real estate refers to the use of public (listed) real estate companies, private (unlisted) real estate funds, REITs, MBS, and related investments. These investments offer exposure without direct involvement in the selection, creation, and management of physical real estate. Indirect real estate should be more convenient for international investors, but this involves costs. The section on international real estate performance shows that the correlation between DRE and IRE can differ significantly within the same market, so the choice of real estate investment vehicles becomes highly important. The section on institutional settings further examines different institutional costs and constraints in international real estate investment.Although this chapter does not provide a review of all real estate markets in the world, it does cover major real estate markets. Specifically, it examines 17 real estate markets on four continents — North America, Europe, Asia, and Australia. The markets discussed are: (1) Australia, (2) Austria, (3) Canada, (4) China, (5) Finland, (6) France, (7) Germany, (8) Hong Kong, (9) Italy, (10) Japan, (11) The Netherlands, (12) Norway, (13) Singapore, (14) Sweden, (15) Switzerland, (16) the United Kingdom, and (17) the United States. The chapter excludes Spain because some data are unavailable. To make best use of available data for a consistent comparison across market, the time frame of study is 2007Q3 to 2012Q2. The Oxford Housing Indexes data available from Datastream serve as performance indicators for the DRE markets. The FTSE EPRA/NAREIT indexes represent the IRE markets, which include all types of listed real estate securities such as real estate companies and REITs. Because the FTSE EPRA/NAREIT index is unavailable in China, the Shanghai Stock Exchange Real Estate Index, which reflects the performance of major Chinese real estate companies, is used instead.

The Advisor's Guide to Commercial Real Estate Investment. David J. Lynn. The National Underwriter Company, 350 pages, 2014.It is easy to forget that real estate investment has many dimensions-and hard to squeeze all of those dimensions into a single volume. Understanding why and how to invest in commercial real estate; knowing how to choose a real estate investment advisor; grasping private market real estate and understanding how to make allocations to a portfolio of private investments; embracing public-market real estate, including both listed and non-listed real estate investment trusts (REITs); and becoming truly up-to-date on current market topics like green real estate and international real estate-all of this is a tall order to condense into a short book.But The Advisor's Guide to Commercial Real Estate Investment is made to order for this challenging task of portmanteau-like compression. In less than 400 pages, the text covers all of these investment topics, and more. David Lynn has divided these topics into discrete chapters, then parceled them out to just the right combination of real estate experts-mostly true real estate scholar-practitioners with at least several decades of experience in their investment areas-to write concise, businesslike, yet thoughtful treatments of the relevant investment topics. It may not be overstating the case to suggest that the Guide may embody as much essential real estate investment knowledge as has ever been assembled in one volume.The result is a type of book that is becoming increasingly rare: a work of great technical virtuosity that is nonetheless highly accessible to the general reader, or at least to the regular reader of real estate literature. The Guide is a type of book that is increasingly rare in another sense as well: it contains abundant charts and diagrams that visually depict otherwise opaque real estate data sets in a graphically appealing fashion also accessible to the general reader.The Guide consistently conveys large amounts of valuable real estate investment information, but highlighting some representative sections conveys the flavor of the book and summarizes the main points.WHYS AND HOWS OF COMMERCIAL REAL ESTATEIn Chapter 1, ''Why Real Estate as an Investment?'' David Lynn, Kevin White, Don Occhionero, and Ross Tieken set a straightforward tone at the outset, giving five main answers to the chapter title's question: (1) large investable universe, (2) high income returns, (3) low volatility, (4) diversification, and (5) inflation hedging. This chapter also emphasizes the importance of developing an investment policy statement to determine the investor's ability and willingness to take risk-really the motivating prologue to the remainder of the book.In Chapter 3, ''Investment Products and Strategies,'' Victor Galanog and Ryan Severino convey the spectrum of advanced real estate investment styles, including debt investments, whole mortgage investments, high-yield debt, commercial mortgage-backed securities (CMBS), core strategy, core-plus strategy, public real estate equities, value-added strategies, private equity strategies, opportunistic strategies, and international strategies. There are more options to suit any investment thesis here than many would imagine.Faye Beverett and Roy Schneiderman guide the investor through the all-important process of ''Choosing the Advisor'' in Chapter 5. The investor should evaluate potential advisors through written materials, in-person interviews with key advisor staff, and third-party assessments of the reputation of potential advisors. The chapter provides handy checklists for due diligence on prospective advisors.PRIVATE REAL ESTATEChapters 6-11 thoroughly explore private-market real estate. Real estate is being drawn more and more into the central investment universe, but the complexity of managing real estate as an asset relative to stocks and bonds always looms as a constraint. …

Climate change is forming an increasingly larger risk for the financial sector, although climate-related financial risks may be underestimated by financial institutions and markets. Financial institutions, such as banks, pension funds, and insurers are mainly exposed to physical climate risks through their investments in real estate. In the absence of any adaptation actions, physical climate risks for these real estate investments are expected to increase because of the higher frequency and intensity of natural disasters in a changing climate. In response to the increasing financial risks associated with climate change, regulatory bodies have been actively shaping new legislation over the past years (e.g. TCFD, CSRD, EU Green Taxonomy).One of the main channels through which the financial sector is affected by flood risk is through physical damage to real estate. After this physical damage, housing prices decrease, and houses located in flood-prone regions sell with a discount compared to similar houses in other areas. Additionally, the credit standing of households diminishes, making mortgages more likely to default, increasing mortgage credit risks for lenders. The 2008 global financial crisis has shown that real estate and its underlying values are a pivotal part of the modern financial system. For this reason, it is imperative to monitor and assess how flood risk affects real estate markets and investors through both direct and indirect channels.These impacts from flooding are currently not yet fully integrated within the risk assessment framework of institutional investors. Dynamic integrated models for insurance markets do exist in the literature, where standard catastrophe flood risk models are matched with insurance sector outcomes. There is currently no clear overview of how physical climate risks affect the balance sheets and profitability of (institutional) real estate investors. This study provides a structured integrated framework for evaluating both the direct and indirect flood-related risks associated with investments in both residential and commercial real estate. Although our bottom-up Dynamic Integrated Flood Real Estate Impacts (DIFREI) model can be applied to other international contexts, we use a real estate portfolio from one of the largest financial service providers in the Netherlands to illustrate the framework’s use and outputs. The DIFREI models can be used to draw lessons for applications on real estate investment portfolios.