In this Dakota Research Interview, Chris LeRoy and Alex DeMarco speak with Tim Ryan, Managing Director and Senior Portfolio Manager of Real Assets at Russell Investments, about the firm’s long-standing commitment to real estate investing and the unique advantages of integrating listed and private strategies.
Tim begins by highlighting Russell’s 40+ year history in private real estate and its role in creating the NCREIF Property Index—now the industry standard benchmark for institutional private real estate. With over $7 billion in AUM across listed and private real assets, Russell takes a comprehensive, research-driven approach that combines historical property-level data, deep manager due diligence, and global market expertise.
A key theme throughout the conversation is the value of blending listed and private real estate in a single portfolio. Tim explains that listed markets provide real-time signals that often precede trends in private valuations, while private markets offer access to a larger and more stable opportunity set. The volatility of listed REITs is not a drawback, he argues, but a tool for generating alpha—particularly when used to gain exposure to sectors not yet accessible via private funds, such as data centers, towers, and self-storage.
Tim dives into Russell’s proprietary valuation analytics, including automated models that compare appraised values to transaction-level pricing. This allows the team to interrogate mismatches and adjust exposures accordingly, helping to avoid overpaying for assets in private markets. He emphasizes that this kind of rigorous underwriting—at both the manager and property level—is essential in today’s market, where there is often a wide delta between book value and market-clearing prices.
The discussion moves into sector-specific insights, where Tim identifies high-conviction areas such as rental housing (including multifamily, single-family rental, and manufactured housing), data centers (driven by surging AI-related demand), and grocery-anchored retail. He also notes a rotation back into coastal markets like Boston, NYC, and LA, where high construction costs and restrictive zoning are limiting new supply, helping fundamentals recover faster than in previously favored Sun Belt markets.
On the credit side, Tim shares how Russell is selectively leaning into real estate debt, where newly issued CMBS offers yields in the 8–9% range—attractive risk-adjusted returns given the current interest rate environment. He stresses the importance of working with experienced sponsors and favoring new transactions with fresh equity backing.
Overall, Tim makes a strong case for real estate's continued relevance in institutional portfolios. Despite short-term challenges, he sees structural tailwinds—supply constraints, inflation protection, and rental growth—that support high-single to low-double-digit return expectations over the long term. By actively blending listed and private assets, and backing insights with decades of proprietary data and experience, Russell aims to deliver superior outcomes across cycles.
LISTEN AND WATCH THE FULL INTERVIEW HERE: SPOTIFY | YOUTUBE
