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Alternative Assets Funds Set Record in AUM

Real estate funds in particular have outperformed hedge funds and listed equity for median net IRR, Preqin said Tuesday.

By Paul Bubny | paulbubny | Updated on September 05, 2017

Preqin headquarters in London Headquartered in London, Preqin says more than a fifth of investors say real estate funds have surpassed expectations over the past three years.

LONDON—The alternative assets sector has reached record proportions, with US$7.8 trillion in assets under management worldwide at the end of 2016, Preqin said Tuesday. The analytics firm said that private capital funds, including real estate funds, have outperformed their public-market counterparts over the past five years.

In examining the median returns reported by public pension funds, Preqin finds that over the five years ending this past Dec. 31 private equity funds have generated a median net annualized return of 11.4%, while real estate funds have returned 11.3%. By comparison, hedge funds have generated a median net annualized return of 5.2% over the same time period, and listed equity has seen median annual returns of 9.1%.

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