Real estate private equity funds can focus investment on anything from "Class A" real estate to redevelopment in the urban center. On the risk-return spectrum, which of the following private equity fund categories tends to have a heavier development component and often involves investment in riskier property types and locations?

Question

Quizplus · Accepted Answer

Opportunistic private equity funds tend to have a heavier development component and often involve investment in riskier property types and locations. They focus on properties that may require significant improvements or repositioning in order to increase their value. This category of fund typically seeks the highest return but also involves the highest risk. Core funds invest in stable, income-generating properties, while value added funds focus on properties that require some level of improvement but with less risk than opportunistic funds. Full platform is not a category of private equity fund.

Real Estate Private Equity Funds Can Focus Investment on Anything