NFI-ODCE posts a 2.11% return for the quarter, up 0.81% from prior quarter
CHICAGO, IL, April 30, 2021 – The National Council of Real Estate Investment Fiduciaries (NCREIF) released first quarter 2021 results for the NCREIF Fund Index – Open‐end Diversified Core Equity (NFI-ODCE). The NFI-ODCE, which added a new fund this quarter, consists of 27 funds, totaling $272.9 billion of gross real estate assets and $226.1 billion of net real estate assets.
NFI-ODCE total return gross of fees for the first quarter 2021 was 2.11%, up from 1.30% in the previous quarter, and from 0.98% a year ago in first quarter 2020. The income return was 0.98%, up from 0.92% in the previous quarter, and down slightly from 1.02% in first quarter 2020. The appreciation return was 1.12% for the quarter, above the previous quarter’s 0.38%, and up from 2020 first quarter’s -0.04%.
Quarterly NFI-ODCE Gross Return Trends
For the one-year ended March 31, 2021, the NFI-ODCE total return gross of fees was 2.32%, up from 1.19% for the one-year ended December 31, 2020 and well below the three-year annualized return of 4.88%. The one-year total return ended March 31, 2021 was comprised of 3.81% income and a -1.45% appreciation return.
NFI-ODCE returns measure fund-level performance and therefore can reflect leverage and other investments beyond properties, including cash balances. Leverage is conservative among these funds given their core strategies, ranging from 15% to 34% over the quarterly series history beginning in 2000. NFI-ODCE leverage is above the 21.8% average since 2000, registering 23.1% as of current quarter-end, down slightly from 23.2% in the previous quarter.
NFI-ODCE Leverage Trends (% of total assets)
Quarterly NFI-ODCE investor net cash flows were negative $2.1 billion, compared to last quarter’s negative $866.7 million, and first quarter 2020’s negative $220.2 million. For the one-year ended March 31, 2021, contributions were $11.2 billion, and distributions and redemptions were $15.8 billion, resulting in an annual investor net cash flow of negative $4.6 billion.
NFI-ODCE Investor Cash Flow Trends (4Q Rolling Total, Billions)
Additional details from the NFI-ODCE release are in the attached Snapshot Report.