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Real Estate: Smart Money Acting Dumb?

Interest Rates are rising, property values are falling and real estate investment vehicles are in trouble. All of them, well apparently not.

Looking at net money flow data for public and institutional open-end real estate funds the latter is up for a record year 2022. From January to November institutional funds bagged a record €14bn of fresh money almost 20% more compared to 2021. And the latter was already a record year.
At the same time, public fund money flows are down by 1/3 YoY, a development you would expect in the current environment.
Do we have an explanation for why smart money seemingly acts dumb at present? No, we don’t but will keep you posted once we find out.