Real Estate and Infrastructure

Free CFA Level I lesson in Alternative Investments. 16 min read, ~2,381 words.

Real estate = land plus permanent improvements. Heterogeneous, immovable, illiquid, large lot size, and operationally intensive (requires active management). Four real estate quadrants: private equity, private debt, public equity (REITs), public debt (CMBS/MBS). Income approach: property value = NOI divided by the cap rate; a 1% cap rate move can...