As the risk of rising inflation continues to grow, Delegate Advisors has been increasing its real estate allocations and shifting away from traditional fixed-income investments. With Intelligence highlighted this change in allocation in a recent article.
Delegate CEO Andy Hart explained that some of Delegate’s client portfolios have grown from 10% real estate allocation to 20-30%. The firm is also exploring office spaces in opportunistic North Carolina areas and potentially searching for experienced managers at those locations. On the multifamily residential side, Delegate is specifically interested in managers that specialize in high-growth areas and logistics, as they have done already in areas outside of the North Carolina area.
Hart also told the publication that they are interested in global real estate managers, including in emerging markets. He adds, however, that increasing allocations to emerging real estate would be more gradual than other real estate areas. “The pace of our expansion is going to be slow just because we’re not as exposed to the managers and the sectors that we would want to invest in,” Hart explained.
Even as Delegate hopes to continue to “widen its net” in real estate investments, the turnover rate of their managers is low. “The managers we’ve picked so far have done a good job and we are invested in two or three funds in most of them,” said Hart. “We try to identify good teams of people that are going to be around for a long time.”