There are plenty of hedge funds investing in real estate in 2024. As an investor, you can learn a lot about the real estate market—including where to invest—by closely following these hedge funds and their performance.

Now, let’s examine the hedge funds investing in real estate this year (and likely beyond).

Cerberus Capital Management

Cerberus Capital Management, L.P. is a global leader in alternative investing, boasting a diversified investor base that includes pension funds, endowments, and private individuals.

Founded in 1992, the firm has a long history of engaging in distressed investing and has since expanded its expertise across multiple asset classes, including real estate.

Cerberus has approximately $60 billion in assets under management (AUM).

Investment focus

Cerberus Capital Management targets undervalued real estate, focusing on commercial, residential, and distressed properties. Its strategy involves strategic acquisitions and improvements to capitalize on market inefficiencies.

Recent performance

Cerberus has shown strong real estate performance, revitalizing underperforming assets and delivering significant returns. Its hands-on management and market acumen have contributed to above-market results.

Fees and investment terms

The firm’s fees include a management fee and a performance incentive, with terms designed to align with investor interests. Minimum investment requirements are in place, catering mainly to institutional and high-net-worth individuals.

 

Angelo Gordon & Co.

Angelo Gordon & Co., established in 1988, stands out as a global investment firm known for its expertise in credit and real estate markets.

With a strong foundation built on a disciplined investment approach, the firm caters to a diverse clientele, including institutional investors and wealthy individuals.

Angelo Gordon & Co. has approximately $78 billion AUM.

Investment focus

Angelo Gordon & Co. specializes in credit and real estate, using a disciplined approach to target distressed, opportunistic real estate investments in the U.S., Europe, and Asia. Its focus is on properties that offer significant upside potential through active management and redevelopment.

Recent performance

The firm has consistently outperformed in the real estate sector, leveraging its expertise to navigate market challenges and capitalize on distressed opportunities. Angelo Gordon’s strategic investments have yielded robust returns for its investors, highlighting its ability to unlock value in complex situations.

Fees and investment terms

Angelo Gordon sets minimum investment thresholds, primarily targeting institutional and sophisticated investors looking for specialized real estate exposure.

GoldenTree Asset Management

GoldenTree Asset Management, founded in 2000, is a leading global asset management firm specializing in high-yield bonds, leveraged loans, and distressed debt.

The firm’s commitment to delivering risk-adjusted returns has attracted a wide range of investors, from institutional entities to high-net worth individuals.

GoldenTree Asset Management has approximately $47 billion AUM.

Investment focus

GoldenTree Asset Management concentrates on high-yield bonds, leveraged loans, and distressed debt, with a keen eye on real estate opportunities that promise high returns. Its approach is analytical, targeting investments that offer significant growth potential through market recovery or operational improvements.

Recent performance

GoldenTree has achieved notable success in the credit and real estate sectors, delivering strong risk-adjusted returns. Its expertise in identifying undervalued assets and navigating financial complexities has resulted in superior performance, attracting attention from a broad investor base.

Fees and investment terms

The firm employs a fee structure that includes a management fee and a performance incentive. GoldenTree caters to a diverse group of investors, setting minimum investment requirements that reflect the firm’s focus on institutional and individual investors.

Farallon Capital Management

Established in 1986, Farallon Capital Management is an asset management firm that deals in diversified investment strategies, including real estate, public and private debt and equity, and merger arbitrage.

The firm’s experience and disciplined risk management approach have made it a trusted partner for universities, foundations, and pension plans seeking to achieve solid long-term returns.

Farallon Capital Management has approximately $36 billion AUM.

Investment focus

Farallon Capital Management employs a diversified strategy that spans real estate, public and private debt and equity, and merger arbitrage. Its real estate investments concentrate on high-potential properties across various sectors, leveraging market dynamics and operational enhancements to drive value.

Recent performance

Farallon has consistently delivered strong performance across its investment portfolio, with real estate ventures standing out for their substantial contributions to overall returns. The firm’s strategic decisions and risk management have enabled it to outperform benchmarks and deliver on its promise of superior long-term gains.

Fees and investment terms

The firm’s fee structure is designed to align Farallon’s interests with those of its investors, featuring both management fees and performance-based incentives.

Oaktree Capital Management

Founded in 1995, Oaktree Capital Management is a global investment management firm known for its specialization in alternative investments, particularly in distressed debt, real estate, and corporate debt.

With an investment philosophy focused on risk control and delivering consistent results, Oaktree serves a broad spectrum of clients, including both major institutions and individuals.

Oaktree Capital Management has approximately $189 billion AUM.

Investment focus

Oaktree Capital Management targets distressed debt, real estate, and corporate debt, applying a methodical investment philosophy that emphasizes risk control. Its real estate strategy focuses on opportunities where it can apply its market knowledge to achieve significant value creation, often in distressed or undervalued assets.

Recent performance

Oaktree has a track record of delivering consistent, strong results, particularly in its specialty areas. The firm’s expertise in navigating complex market conditions and its strategic investment choices have contributed to its reputation for stability and high performance, even in volatile markets.

Fees and investment terms

Oaktree caters to a wide range of investors, with terms and minimum investment requirements that reflect its focus on institutional and sophisticated individual investors.

Final Thoughts

While these are five of the highest-performing hedge funds investing in real estate in 2024, there are many others to research.
As you learn more about these hedge funds and others, look for ways to use your newfound knowledge to improve your approach to real estate investing.

 

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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.