Blackstone’s Entry Energizes PNLR Market
In the latest episode of The REIT Report: NAREIT’s Weekly Podcast, Tony Chereso, president and CEO of the Investment Program Association (IPA), talked about the latest developments in the public non-listed REIT (PNLR) market.
Chereso discussed the impact of private equity firm Blackstone’s entry into PNLRs. He noted that the Blackstone Real Estate Income Trust (BREIT) has raised significant capital via wirehouses and independent broker-dealers.
“Blackstone has a great reputation and has reminded the market and advisers that these assets can play an important ingredient in a well-diversified portfolio, particularly for investors seeking yields and low correlation to the traditional equity markets,” Chereso said.
Blackstone’s entry into the space has reinvigorated capital raising for PNLRs, especially for daily NAV products, according to Chereso.
“We expect that we will see capital raising improve exponentially over 2016,” he said.
Chereso also commented on the President Donald J. Trump’s intention to roll back regulations for the financial sector, such as his directive to the Department of Labor to review its so-called Fiduciary Rule. Chereso said the IPA supports Trump’s executive order with regard to that specific rule.
The IPA believes “certain aspects of the Fiduciary Rule, if revisited, could have a very positive impact in regards to financial advisers to be able to continue to provide professional advice to certain segments of the investment community.”
“Over time, inflation leads to increased rents and healthy capital gains on real estate investments, and, therefore, inflation will ultimately increase the value of REITs and other real estate equities,” he said. “The prospect of inflation is not a death knell for REIT investing at all.”
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Published at Fri, 10 Feb 2017 16:32:49 +0000