Scalable, institutional-quality opportunities in these sectors were few and far between, but today the opposite is true. In the past decade, developers and investors have rotated away from commercial sectors towards more mature alternative sectors such as PBSA, BTR and Life Sciences, attracted by strong outperformance, lower volatility and less correlation with macroeconomic cycles, additive diversification, and attractive demographics that look set to underpin the future performance of these sectors.

Other emerging alternative sectors such as digital, healthcare and self-storage have also been underpinned by similarly strong fundamentals but have remained relatively underinvested in Europe to date. Harrison Street has invested in these sectors in the US since 2006, investing €18bn across 635 assets over that timeframe. We have also tracked these sectors in Europe for a number of years and have waited to time our entry point until the opportunity is most favourable. We believe that 2024 provides that opportunity as we move towards the next phase of alternative sector investment in Europe. While these sectors remain highly fragmented with high barriers to entry, many similarities exist between these sectors in Europe now and the opportunity in the US almost two decades ago. The growing maturity of this group of alternative sectors means they have now reached a critical scale, with a greater number of opportunities across the investment spectrum to invest in or develop institutional-quality real assets in a number of European markets.

Read the full ‘Thought Leadership’ article at the link below