Understanding Flows into Open End Real Estate Funds

Open end real estate funds are the prevailing German retail product for commercial real estate investment. Yet, relatively few empirical studies explore the distinct characteristics of this asset class; almost no evidence exists with regard to flows. Looking at aggregate and individual fund flows we try to better understand investor behaviour and assess whether some well established facts from the mutual fund-flow literature apply also to open end real estate funds. We analyse the interrelation between flows into open end real estate funds, equity, bond and money-market funds. We also look at individual fund flows and ask to what extent investors are sensitive to fund characteristics and past performance.