In recent years, operational real estate has expanded as a new investment approach for integrated investment vehicles offering services on top of the traditional fund and asset management.
To bring more clarity in this field and to promote market transparency, the new Operational Real Estate Committee has developed a definition of Operational Real Estate as follows:
‘An investment in a real estate asset structured so as to create a strong correlation between returns to the asset owner and the underlying operational performance of the operator or occupant.
Operational real estate investments typically entail a different risk-return profile (operational, financial, or both) when compared to non-operational investments. Such investments may be accessed via a variety of structures, including, but not limited to, operational services agreements, joint venture arrangements or taking equity stakes in an operating business.’
This definition can be found in the Global Definition Database, the leading source of definitions for the non-listed real estate industry.
View GDD