Operationally Intensive Real Assets
Real Estate Debt and Sustainability
Mar 14th, 2021 | Filed under: Real Estate, Infrastructure, Industry Size & Managers, Socially responsible investing, Alternative energy, Operationally Intensive Real Assets, ESG, Climate change, Real Estate Equity InvestmentsA new report from two executives at Aviva Investors, the global asset manager that is part of the UK-based Aviva Group, looks at real estate debt as a way to play the transition to a low-emissions or even a no-net-emissions world. One key source of value here is that theRead More
The Rationale for Investing in Exotic Alternative Investments Today
Feb 9th, 2021 | Filed under: Newly Added, Operationally Intensive Real Assets, Alternative Investments in Context, The Alts Industry, Private InvestmentsBy Kevin R. Mirabile, CPA, DPS The current rationale for investing in exotic alternative investments is based on a combination of stand-alone returns, risks and portfolio effects. Today, exotic alternative investments offer investors an opportunity to achieve many of the stand-alone and portfolio benefits that hedge funds and other typesRead More
Systemic Impact and ESG Investing in Smart Cities
Feb 2nd, 2021 | Filed under: Infrastructure, Newly Added, Artificial Intelligence, Operationally Intensive Real Assets, ESG, Other Topics in Alts
What is a smart city? By definition, a smart city is “a city that uses technology and data purposefully to make better decisions and deliver better quality of life.” Technology is intricately embedded into the everyday life of city dwellers through network devices, applications, and widely distributed usage. The combinationRead More
Lenders: Project Financing Availability is Key to EGD’s Success
Jan 24th, 2021 | Filed under: Real Estate, Infrastructure, Newly Added, Institutional Investing, Other Issues in Private Investments, Operationally Intensive Real Assets, ESG, Institutional Asset Management, Private Investments, Real AssetsEUPOPEAN GREEN DEAL – TOWARDS A ZERO-CARBON URBAN ENVIRONMENT, Part 5 By Christos Angelis, CAIA – Director at Masterdam This is the fifth article in this series. For Part 1, please click here. LENDERS TO PLAY A MAJOR ROLE IN THE SUCCESS OF EGD As discussed in previous articles, theRead More
European Green Deal: Towards a Zero-Carbon Urban Environment (Part 4)
Dec 3rd, 2020 | Filed under: Real Estate, Infrastructure, Newly Added, Socially responsible investing, Alternative energy, Operationally Intensive Real Assets, Alternative Investments in Context, ESG, Climate change, Emerging Alternative Investments, Private Investments, Real Assets, SRI and Clean EnergyPart 4: Real Estate Developers: Hostage of Trophy Hunting Investors & Certification Standards? By Christos Angelis, CAIA – Director at Masterdam This is the fourth article in this series. Please read Part 1, Part 2 and Part 3. THE RELEVANCE OF THE EUROPEAN GREEN DEAL FOR DEVELOPERS Real estate development in the EuropeanRead More
Real Assets ‘Inception:’ Diversification within Diversification
Feb 27th, 2020 | Filed under: Consultants, Real Estate, Liquid and Fixed Income Real Estate, Newly Added, Institutional Investing, Risk management, Asset allocation, Natural Resources and Land, CAIA Alternative Viewpoints, Asset Allocation Models, Operationally Intensive Real Assets, Endowments & Foundations, Institutional Asset Management, Real Estate Equity Investments, Risk Management Strategies & Processes, Real AssetsBy Aaron Filbeck, CFA, CAIA, CIPM, Associate Director, Content Development at CAIA Association Excerpted from the Alternative Investment Analyst Review, Volume 8, Issue 1 The Alternative Investment Analyst Review is the official publication of the CAIA Association. Access to the most current issue is an exclusive benefit of CAIA MembershipRead More
Greenfields and Brownfields: Asian Investors Backing Infrastructure Investments
Dec 22nd, 2019 | Filed under: Infrastructure, Debt Types of Private Equity, Newly Added, Credit Derivatives, Other Issues in Private Investments, Operationally Intensive Real Assets, The Alts Industry, Structured Credit Products, Private Investments, Real Assets, Structured ProductsThe Asian Infrastructure Investment Bank has taken a 30% stake in Bayfront Infrastructure Management. Clifford Capital, with the backing of the government of Singapore, has the other 70%. They have created Bayfront (with a combined capitalization of $180 million) to mobilize a pool of infrastructure investors in the expectation thatRead More
Africa: Alpha for the Bold
Dec 15th, 2019 | Filed under: Infrastructure, Newly Added, The Global Economy & Currencies, Emerging markets, Operationally Intensive Real Assets, Economics, The Alts Industry, Frontier markets, MacroeconomicsThe CFA Institute, in conjunction with the African Stock Exchanges Association (ASEA), has put together a book on the challenges and opportunities in the African capital markets. In Africa as elsewhere, fortune favors the bold. For example—and this is not an example from the ASEA and CFA Institute’s book—the EnkoRead More
AIMA: Looking at the Canadian Landscape
Oct 22nd, 2019 | Filed under: Hedge Fund Industry Trends, Infrastructure, Newly Added, Fintech, Technology, Operationally Intensive Real Assets, The Alts Industry, Structure of the Hedge Funds Industry, Other Topics in AltsThe Alternative Investment Management Association first opened a branch in Canada in 2003. In recent days, AIMA has posted a report on what it calls the “landscape.” It doesn’t mean the Rockies. It means the lay of the land for alternative investments in that country. AIMA’s report looks at aRead More
‘Greenwashing:’ Why the Glass is Half Full
Sep 19th, 2019 | Filed under: Social investing, Newly Added, Socially responsible investing, Other Issues in Private Investments, Operationally Intensive Real Assets, The Alts Industry, Emerging Alternative Investments, Private Investments, SRI and Clean Energy, Other Topics in AltsThe term “greenwashing” is not a compliment. It isn’t supposed to be a good thing. Greenwashing means the re-spraying of old products and services so that they seem to comply with standards for socially responsible investment. Many investors want to put their money to work in ways that reflect theirRead More
The Dangers and Attractions of Infrastructure Investing
Jul 4th, 2019 | Filed under: Infrastructure, Newly Added, Institutional Investing, Natural Resources and Land, Other Issues in Private Investments, Operationally Intensive Real Assets, The Alts Industry, Institutional Asset Management, Real Assets, Other Topics in AltsAn arm of Brookfield Asset Management, Brookfield Infrastructure, announced that it is leading a group of investors to buy Genesee & Wyoming for a cash payment of $112 per share, a premium of nearly 40% over the pre-announcement stock price. This is a big infrastructure play. G&W is a freightRead More
A Fintech Revolution in Commercial Real Estate
May 9th, 2019 | Filed under: Real Estate, Newly Added, Technology, Operationally Intensive Real Assets, The Alts Industry, Real Estate Equity InvestmentsCushman & Wakefield, Chicago, has released a discussion of blockchains in connection with real estate. The paper argues that the technology could “transform CRE transactions ranging from property listings, asset management, and the purchase and sale of properties.” It reminds us that blockchains are shared digital ledgers, both tamper-proof andRead More
The Illiquidity Premium and the Market for Private Assets
Apr 14th, 2019 | Filed under: Real Estate, Private Equity, Debt Types of Private Equity, Liquid and Fixed Income Real Estate, Newly Added, Asset allocation, Equity Types of Private Equity, Asset Allocation Models, Other Issues in Private Investments, Operationally Intensive Real Assets, The Alts Industry, Real Estate Equity Investments, Private Investments, Real Assets, Finance & EconomicsThe illiquidity premium is one of the most frequently discussed and hotly disputed subjects in financial economics. Speaking broadly, an investment is not a checking account. One generally cannot just “get the cash back” at a moment’s notice, by visiting some equivalent of an ATM. How long will it takeRead More
Striking the Right Balance: Investing in Real Assets
Apr 11th, 2019 | Filed under: Infrastructure, Liquid and Fixed Income Real Estate, Newly Added, Natural Resources and Land, Operationally Intensive Real Assets, The Alts Industry, Real AssetsIn creating the real assets portion of a portfolio, investors should consider several risk factors, such as the sensitivity of certain assets to inflation, interest rate changes (duration risk), or the continued availability of finance (illiquidity risk). In a recent publication, Mercer, the world’s largest institutional investment advisor, explains howRead More
Alternative Real Estate Shows Attractively
Mar 28th, 2019 | Filed under: Real Estate, Liquid and Fixed Income Real Estate, Newly Added, Operationally Intensive Real Assets, The Alts Industry, Real Estate Equity Investments, Real AssetsPricewaterhouseCoopers, the London-based professional services network, in conjunction with the Urban Land Institute, has prepared a report on ongoing trends in real estate, which sheds some light on the attractions of alternative real estate. The background to the report is the continued and intensifying consensus that a recession is nigh,Read More
Pension Funds Not Quite Swamped by ‘Grey Tsunami’
Mar 5th, 2019 | Filed under: Real Estate, Private Equity, Hedge Fund Strategies, Infrastructure, Equity Hedge Funds, Debt Types of Private Equity, Newly Added, Institutional Investing, Asset allocation, Event-Driven Hedge Funds, Equity Types of Private Equity, Natural Resources and Land, Asset Allocation Models, Operationally Intensive Real Assets, The Alts Industry, Institutional Asset Management, Macro and Managed Futures Funds, Real Estate Equity Investments, Hedge Funds, Commodities, Private Investments, Real Assets, Allocating to AltsA recent study of public employee retirement systems in the United States reaches conclusions, that, after a fair amount of “grey tsunami” alarmism in recent years, sound reassuring. The study, based on a recent survey of system managements conducted by the National Conference of Public Employee Retirement Systems (NCPERS) inRead More
Green Bonds: The Future of Infrastructure Investing
Feb 24th, 2019 | Filed under: Commodities, Infrastructure, Investing in Commodities, Debt Types of Private Equity, Newly Added, Institutional Investing, Socially responsible investing, Operationally Intensive Real Assets, Climate change, Institutional Asset Management, Hedge Funds, Commodities, Private Investments, Real Assets, SRI and Clean Energy, Other Topics in AltsTwo scholars affiliated with the Centre for International Governance Innovation, Waterloo, Canada, have taken a look at the future of green bonds, that is, bonds whose proceeds are employed to fund environmental initiatives. The paper, by Olaf Weber and Vasundhara Saravade, begins with a guesstimate as to the amount ofRead More
How Public Pension Funds are Subsidizing Infrastructure
Jan 29th, 2019 | Filed under: Infrastructure, Newly Added, Institutional Investing, Socially responsible investing, Alternative energy, Operationally Intensive Real Assets, The Alts Industry, Institutional Asset Management, Frontier markets, Real Assets, SRI and Clean EnergyPublic pension funds in the United States invest in infrastructure. Unfortunately, they aren’t very good at it. A recent working paper of the NBER concludes, indeed, that public pensions are so bad at such investments that they—and thus either the public or its retirees or both—are unwittingly subsidizing infrastructure projects.Read More
Pensions and Real Estate: CEM Benchmarking
Oct 11th, 2018 | Filed under: Real Estate, Newly Added, Institutional Investing, Asset allocation, Asset Allocation Models, Operationally Intensive Real Assets, The Alts Industry, Institutional Asset Management, Real Assets, Allocating to AltsA new paper by Alexander D. Beath and Chris Flynn examines the significance of real estate investing within the portfolios of large European institutional investors from 2005 to 2016. Beath is a senior research analyst with CEM Benchmarking, with a PHD. from McGill University on condensed matter and materials physics.Read More
Crumbling infrastructure offers mid-market investment opportunities
Jun 3rd, 2018 | Filed under: Infrastructure, Newly Added, Socially responsible investing, Operationally Intensive Real Assets, Real Assets, SRI and Clean EnergyDeteriorating infrastructure and potential for investment is the topic of a new white paper by Fiera Capital, a Canadian investment management firm. Infrastructure is generally understood to involve physical assets that provide a public service, including those most vital to economic development. The category includes water and waste-water systems, highwaysRead More
KPMG’s Report Cards on Real Assets
Jan 23rd, 2018 | Filed under: Real Estate, Infrastructure, Liquid and Fixed Income Real Estate, Newly Added, Institutional Investing, Natural Resources and Land, Operationally Intensive Real Assets, Institutional Asset Management, Real Estate Equity Investments, Real AssetsKPMG has posted a new paper looking at the role of real assets (defined as “anything where there is a tangible/physical asset being traded”) within a portfolio, with a focus on opportunities for U.K. based institutional investors, especially pension schemes. It begins with a brief survey of the field. RealRead More
Searching for the Right Infrastructure Manager: 3 Case Studies
Jan 14th, 2018 | Filed under: Infrastructure, Newly Added, Institutional Investing, Operationally Intensive Real Assets, Institutional Asset Management, Real Assets, Allocating to AltsA new paper from bfinance (an independent financial services consultancy headquartered in London) discusses the “dramatically different era” into which infrastructure investing has entered over the last two years. The paper, “DNA of a Manager Search: Infrastructure,” looks at three recent unlisted infrastructure searches, in order to glean some insightRead More
EDHEC, New Research, and Hyper-illiquid Assets
Oct 12th, 2017 | Filed under: Newly Added, Operationally Intensive Real Assets, Real AssetsThe EDHEC Infrastructure Institute – Singapore has published a new paper describing what it calls the “very first results of an ambitious project to create investment benchmarks for long-term investors in infrastructure.” The Institute is host to a dedicated team, who for years now have been collecting and aggregating primaryRead More
A Critique of the Listed Infrastructure Sector
Jul 18th, 2017 | Filed under: Newly Added, Operationally Intensive Real Assets, Real AssetsA new study by EDHECinfra (EDHEC’s infrastructure institute based in Singapore), has a striking point of view on the whole “listed infrastructure” sector, which it says is based on the “fallacy of composition.” In economics and in logic, the term “fallacy of composition” refers to the general prejudice that ifRead More
Real Estate: A Global Outlook
Jul 13th, 2017 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real Assets, Real AssetsPWC and the Urban Land Institute have jointly issued a report on “emerging trends in real estate” around the globe, which stresses that real estate’s attraction as an investment, even as a cross-border investment, has held up notwithstanding unprecedented levels of concern about geopolitics. The “global drift back to domesticRead More
Some Granularity on the Mexican Pension Industry
Apr 4th, 2017 | Filed under: Newly Added, Operationally Intensive Real Assets, Institutional Asset Management, Real Assets, Allocating to AltsBlackRock has published a research report about pension funds in Mexico, a report produced as part of its broader research project looking into the state of the pension fund industry around the globe. It shows that the cause of alternatrive investments as a group is the cause of diversification forRead More
Citi GPS on the Infrastructure as Asset Class
Mar 19th, 2017 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real AssetsCiti Global Perspectives and Solutions (Citi GPS) has published a new white paper on the global need for infrastructure spending. The authors are: Jason Channell, head of EMEA Infrastructure Research; Elizabeth Curmi, Global Thematic Analyst; and David Lubin, head of Emerging Markets Economics. Channell et al contend that “now couldRead More
Listed Infrastructure as a Complement to the Private Funds
Mar 7th, 2017 | Filed under: Newly Added, Operationally Intensive Real Assets, Real AssetsTwo portfolio managers (and senior VPs) at Cohen & Steers, in a new white paper, make the case that “listed infrastructure is an attractive complement to private investments, providing long-term portfolio solutions for real asset allocations.” Cohen & Steers, a New York headquartered global investment manager, recommends that institutions allocateRead More
SWFs Looking to PEs Both as Intermediaries and as Co-investors
Feb 2nd, 2017 | Filed under: Infrastructure, Newly Added, Natural Resources and Land, Operationally Intensive Real Assets, Real AssetsA recent working paper from the European Corporate Governance Institute discusses direct investment by sovereign wealth funds in private equity transactions – that is, it discusses an ongoing shift from investing in PE funds to co-investing with PE funds. The paper describes this as a trend especially viable in theRead More
Infrastructure Project Finance: Benchmarking and Definitions
Nov 22nd, 2016 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real Assets, Real AssetsIn a new article in The Journal of Alternative Investments, three EDHEC-affiliated scholars, led by Frédéric Blanc-Brude, the director of the EDHEC Infrastructure, Singapore, look at recent improvements in the understanding of the financial performance of privately held infrastructure investments, debt or equity, with respect to benchmarking thereof. They concludeRead More
Dakota Access and the Army Corps of Engineers: An Odd Mistake?
Nov 13th, 2016 | Filed under: Commodities, Infrastructure, Newly Added, oil, Operationally Intensive Real Assets, Commodities: Examples, CommoditiesOn November 7, the U.S. Army Corps of Engineers put out a statement that said that the Dakota Access Pipeline (DAPL) had agreed to halt its controversial ongoing construction in North Dakota. The following day, which happens to have been Election Day, [so non-election news went largely uncovered], the ownersRead More
McKinsey: Historically Anomalous Period Nears an End
Nov 6th, 2016 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real Assets, Alternative Investments in Context, The Alts Industry, Real AssetsMcKinsey & Co. has posted a new report assessing the state and the future of the North American asset management industry, encompassing both active and passive managers and looking at five mega-trends. Skipping to the chase, the trends are these: The end of an anomalous eta of “exceptional investment returns.”Read More
Islam, Western Pensions, and Real Assets
Oct 18th, 2016 | Filed under: Newly Added, Institutional Investing, Intellectual Property, Natural Resources and Land, Operationally Intensive Real Assets, Institutional Asset Management, Real Assets, Allocating to AltsA recent academic discussion of the much-vexed question of Islamic finance (including the always at least implicit query, how does it fit into the broader usually non-Islamic global picture?) focuses on the role in Islam of real assets, understood as tangible objects such as land, buildings, machinery, and commodities. TheRead More
Saving the World: One EM City at a Time
Oct 10th, 2016 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real AssetsThe Global Commission on the Economy and Climate has issued a new report urging governments and major financial institutions to “scale up and shift investment to sustainable infrastructure as a fundamental strategy….” The report, The Sustainable Infrastructure Imperative, has no force as law or policy anywhere, but it may signalRead More
Kyle Bass, IPR and Shorting Big Pharma
Sep 22nd, 2016 | Filed under: Newly Added, Intellectual Property, Operationally Intensive Real Assets, Personalities in AI, Real Assets, Other Topics in AltsKyle Bass, the investor who shorted the market in residential mortgage-based securities a decade ago, with speculator success, is interested now in shorting the major pharmaceutical companies. He is certainly entitled to try that play. But what is especially provocative and controversial is that he also seems willing to giveRead More
Private Capital Fundraising Slows: Green and Brown Valleys
Jul 14th, 2016 | Filed under: Real Estate, Infrastructure, Newly Added, Farmland, Natural Resources and Land, Operationally Intensive Real Assets, Real Estate Equity Investments, Real Assets, Other Topics in AltsPreqin, the multinational data and consulting firm, has looked at the second quarter and found it was, for private capital fundraising … slow. So was the quarter before it. Together they made up the first half of 2016, in which the funds closed in the world of private capital globallyRead More
Infrastructure: Look at the Contracts–Not the Industry or the Index
Jul 10th, 2016 | Filed under: CAPM / Alpha Theory, Infrastructure, Financial Economics Theory, Newly Added, Operationally Intensive Real Assets, Real Assets, Finance & EconomicsA new paper from EDHEC Infrastructure Institute decides that there is no such thing as a listed infrastructure asset class. What is the practical significance of that inference? It means that for investors (individual or institutional) looking to diversify their portfolio properly, a dedicated index focused on a listed infrastructureRead More
Welcome to Low-Return World: Will Chief Investment Officers and Trustees be ready?
Jun 22nd, 2016 | Filed under: Infrastructure, Newly Added, Institutional Investing, Operationally Intensive Real Assets, Institutional Asset ManagementBy Charles Skorina For executive recruiters like us, that’s a question we’ll have to wrestle with as we present candidates to the boards of institutional asset managers. Two of our investment-management village elders–Bill Gross and Burton Malkiel–say we’re staring down the barrel of a low-return decade. They’ve been around for aRead More
Somebody Has to Crunch These Numbers: Infrastructure Cash Flow
Jun 5th, 2016 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real Assets, Real AssetsEDHEC Infrastructure Institute-Singapore recently released a paper on the cash flow dynamics of private infrastructure project debt. The gist of the paper is that investors’ ability to understand credit risk in private infrastructure debt turns on advanced statistical techniques. Or, in the authors’ words, “the nature of the data requiresRead More
Infrastructure, Dividends and Path Dependence
Apr 21st, 2016 | Filed under: Infrastructure, Newly Added, Operationally Intensive Real Assets, Real AssetsA new paper from EDHEC Infrastructure Institute-Singapore argues that infrastructure firms represent a unique business model, one with lower revenue volatility, higher payouts, and substantially lower correlation with the business cycle than other firms. An “infrastructure firm” for purposes of this discussion is either a special purpose vehicle created inRead More
API: An Emerging Multi-Trillion-Dollar Market
Sep 29th, 2015 | Filed under: Operationally Intensive Real Assets, Business NewsIBM has now purchased Strongloop, and this has gotten Faille thinking about APIs, a potential multi-trillion dollar market. Where technology's imperatives press again the law: how to bet? Read More
How Public Pensions Are Getting Smart About Infrastructure
Sep 24th, 2015 | Filed under: Operationally Intensive Real Assets, Institutional Asset ManagementGuest columnist Jill Eicher looks at how public pension funds are cutting out the middle man and leveraging the power of their own capital for infrastructure investments.Read More
An Overview of Real Asset Investing
Aug 26th, 2015 | Filed under: Real Estate, Private Equity, Infrastructure, Risk management, Intellectual PropertyGuest columnist Andrew Smith, CAIA, provides an overview of real assets and their commensurate risks and rewards.Read More
SCOTUS on Copyright Means a Win for Fences: Loss for the Noosphere
Jul 6th, 2015 | Filed under: Institutional Investing, Intellectual PropertyAn idea for the hierarchical design of a platform's APIs, and a particular expression of that idea, walk into a bar. What's the punch line? Read More
PwC Looks Ahead to 2020: Offers a Roadmap for Alternative Investment Managers
Jul 5th, 2015 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Infrastructure, Technology, Emerging marketsPwC offers a glimpse of a 'day in the life' of a typical compliance analyst in 2015 and again in 2020. As these authors tell it, the day is filled with data, darkness, and drudgery at present, but it will be airy, alliterative, and analytical in another five years. Read More
Who Will Meet Yahoo at the Altar?
Jun 16th, 2015 | Filed under: Real Estate, Alpha Strategies, Technology, Intellectual PropertyThere was some excitement as recently as January 2015 over renewed talk of a Yahoo/AOL deal, but after the bloom finally came off that rose, YHOO settled into a trading range has been roughly from $42 to $46. Faille guesses that there is an opportunity here on the upside of that range, because another suitor is bound to appear.Read More
Java IP War: The Obama Administration Picks the Wrong Side
Jun 8th, 2015 | Filed under: Technology, Intellectual PropertyThe Solicitor General, speaking for the United States, has filed the expected amicus brief in the Google/Oracle showdown. The SG's position is that the Supreme Court should refuse to hear the case so that the lower courts can get back to using what the brief calls the "flexible fair use doctrine" to do justice. Read More
Farm Land: The Risks & Rewards of Buying Direct
Jun 7th, 2015 | Filed under: Real Estate, Infrastructure, Institutional Investing, FarmlandGuest columnist Andrew Smith, CAIA, examines the risks and rewards of investing directly in farmland.Read More
What’s in a Copyright? Java API Case Before U.S. Supreme Court
May 25th, 2015 | Filed under: Institutional Investing, Technology, Intellectual PropertyHigh-stakes litigation between Google and Oracle approaches its resolution at the Supreme Court. For seekers of alpha, this isn't just about what investments to make, but about the way one goes about making them, the very mechanics of trading. Read More
Some Assets are Hard to Ignore
Apr 23rd, 2015 | Filed under: Currencies, Infrastructure, Hard metals, Alpha Hunters, Alpha Strategies, GoldGuest columnist Diane Harrison looks at the world of alternatives to alternatives, including stamps, cars, farmland and more...Read More