Margaret Belmondo of NEPC was recently featured in a FundFire article discussing why pensions in certain states are increasing their focus on real assets, driven by stronger real estate fundamentals and AI infrastructure. View excerpts below or read the full article on the FundFire site here.
Pensions in New York, California, Ohio, Connecticut and New Hampshire are upping their focus on real assets, spurred by improved real estate fundamentals and AI infrastructure.
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Real estate deal pricing appears to have stabilized as transaction volumes started to rebound in many markets, said Margaret Belmondo, head of the public fund practice at institutional consulting firm NEPC.
“It remains a favorable time to be a liquidity or solution provider, with opportunities in real estate lending, secondaries, and opportunistic equity strategies,” Belmondo said. “After several years of limited activity, real estate fundraising may start to recover in 2025 as private real estate values improve.”
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Continued investor excitement around sectors like digital assets and the energy transition, coupled with investors building new target allocations, should sustain strong capital raising in 2025, Belmondo said.
“A notable trend is the rise of smaller infrastructure firms, often spin-offs from larger players, which presents promising opportunities in the lower-middle market,” she said.
And as some investors are shifting away from “strict ESG considerations,” such moves have triggered a fundraising pickup in the energy sector – although still “modest compared to the mid-2010s,” said Belmondo.