NCREIF Fund Index – Open End Diversified Core Equity (NFI-ODCE)

The NFI-ODCE is a capitalization-weighted, gross of fee, time-weighted return index with an inception date of December 31, 1977.  Supplemental data is also provided, such as equal-weight and net of fee returns, for informational purposes and additional analysis. 

Open-end funds are generally defined as infinite-life vehicles consisting of multiple investors who have the ability to enter or exit the fund on a periodic basis, subject to contribution and/or redemption requests, thereby providing a degree of potential investment liquidity.  The term Diversified Core Equity style typically reflects lower risk investment strategies utilizing low leverage and generally represented by equity ownership positions in stable U.S. operating properties  diversified across regions and property types.

The NFI-ODCE, like the NCREIF Property Index (NPI) and other stock and bond indices, is a capitalization-weighted index based on each fund’s net invested capital, which is defined as beginning market value net assets (BMV), adjusted for weighted cash flows (WCF) during the period. 

Additional information, such as the equally-weighted NFI-ODCE, is also presented to show what the results would be if all funds were treated equally, regardless of size. 

Additionally, NCREIF offers an NFI-ODCE Performance Attribution Report.  This report provides users with full disclosure and transparency regarding the main attributes and key drivers of the benchmark.

Click here for further information around the NFI-ODCE Performance Attribution report.

Quarterly Returns

The table below represents gross total returns (value weight) for the NFI-ODCE


The NFI-ODCE, short for NCREIF Fund Index - Open End Diversified Core Equity, is the first of the NCREIF Fund Database products and is an index of investment returns reporting on both a historical and current basis the results of 38 open-end commingled funds pursuing a core investment strategy, some of which have performance histories dating back to the 1970s. The NFI-ODCE Index is capitalization-weighted and is reported gross of fees. Measurement is time-weighted. NCREIF will calculate the overall aggregated Index return.

The universe of funds comprising the NFI-ODCE employ, or did employ in the case of liquidated funds, a generally acknowledged investment style or strategy known in the business as "core" investing. Every fund included in the Index as well as any existing funds or those in the planning stages that aspire to be included in the Index must meet the following inclusion criteria.

A fund must market itself as an open-end commingled fund pursuing a diversified core investment strategy, primarily investing in private equity real estate with the following guidelines. 

  • Net Assets Criteria
    • Real Estate - at least 80% of the market value of net assets must be invested in real estate with no more than 20% invested in cash or equivalents.
  • Real Estate Net Assets Criteria
    • Investment - at least 80% of the market value of real estate net assets must be invested in private equity real estate properties [no more than 20% of such assets may be invested in, but not limited to, property debt, public company, equity/debt or private company (operating business) equity/debt].
    • Domain - at least 95% of market value of real estate net assets must be invested in US markets.
    • Property Types - at least 80% of market value of real estate net assets must be invested in office, industrial, apartment and retail property types.
    • Life Cycle - at least 80% of market value of real estate net assets must be invested in operating properties [no more than 20% of such assets may be invested in, but not limited to, (pre)development/redevelopment or initial leasing/lease-up cycles].
    • Diversification - no more than 65% (± for market forces) of market value of real estate net assets may be invested in one property type or one region as defined by the NPI. 
  • Total Assets Criteria
    • Leverage - no more than 35% leverage. Leverage is defined as the ratio of total debt, grossed-up for ownership share of off-balance sheet debt, to the fund's total assets, also which are grossed-up for such off-balance sheet debt. 

The fund must comply with the NCREIF PREA Reporting Standards, including annual audits, quarterly valuations and time-weighted returns. Further, the fund must submit information in accordance with the NCREIF Fund Data Collection and Reporting Manual. Timely, accurate and industry compliant data is required. 

For the fund formula, use the modified-dietz formula which is well documented in GIPS. This is the industry standard for all asset classes.

The formula is basically;
1) Numerator = Total Return $ (Income and Appreciation)
2) Denominator = Weighted Average Equity (Beginning Net

Assets plus weighted contributions minus weighted distributions for the period, generally quarterly). The weighting of contributions and distributions is based on the actual day of each cash flow and how long the cash flow is "in" or "out" of the portfolio.

The numerator varies depending upon whether it's before or after fee. The denominator is the same for both