The CRE investment landscape is evolving quickly as traditional sectors such as office and retail have faced structural challenges during the past decade while alternative sectors have attracted an increasing share of capital. Investments in alternative CRE sectors have reached $14.2 billion in transaction volume during the past year, or 16% of total CRE volume, according to a report from Clarion and Rosen Consulting Group (RCG).

The total size of the US CRE investable universe is $26.8 trillion, of which $11.7 trillion is institutional quality, according to the report. The institutional estimate filters out properties that fall below typical institutional standards for building size and quality as well as markets that are too small or insufficiently liquid for institutional investors. The study noted this estimate is more than ten times the size of the NCREIF Property Index (NPI).

Traditional property types, including industrial, multifamily, office, retail and hotels, make up the largest share of the investable universe at $16.9 trillion or 63% of the investable market. Of this total, 48%, or $48.2 trillion, is considered of institutional quality. Within the $11.7 trillion institutional universe, traditional sectors account for close to 70% of the total. Apartments are the largest traditional sector with a value of $2.6 trillion, accounting for more than one-fifth of the institutional universe.