Private real estate credit gains traction as investors seek stable returns amid market shifts

On October 24, 2024, Benefits and Pension Monitor, in partnership with Fiera Capital, hosted a webinar titled “The Rise of Private Real Estate Credit in Canada’s Evolving Investment Landscape.” 

The event brought together industry experts, including Michael Le Coche, director of Research and Predictive Analytics at Fiera Real Estate, alongside Martin Saulnier, Hans Jain, and Daniel Jacobson, to discuss the growing appeal of private real estate credit as an alternative to traditional fixed-income investments. 

Private real estate credit offers higher yields, improved portfolio diversification, and a reduced exposure to the volatility seen in public markets, positioning it as an attractive asset class.  

With inflation pressuring traditional bond markets, private real estate credit provides a stable income stream that is drawing attention from both financial advisors and individual investors seeking reliable returns. 

Among the topics covered, regulatory shifts were a significant focus. Basel IV regulations are tightening lending restrictions for traditional banks, leaving potential gaps in financing that private credit lenders are poised to address.  

This regulatory environment is creating new opportunities for private lenders to expand their role in the market. 

Private real estate credit also presents a favourable risk-return profile. Compared to traditional fixed-income products, it delivers more stable returns without exposing investors to the dramatic swings of public markets, offering a balanced approach for portfolio enhancement. 

The panel discussed how Canada’s regional real estate markets exhibit diverse dynamics that influence private real estate credit strategies. Recognizing and adapting to these regional differences can help investors identify promising areas with high potential for growth. 

Sustainable investment strategies in the real estate credit sector were another key point, as sustainability is becoming integral to real estate lending and development. Experts emphasized the importance of aligning environmental goals with financial performance in this sector. 

Throughout the webinar, participants were encouraged to consider private real estate credit as a way to strengthen portfolio resilience and capitalize on emerging opportunities.  

This session provided attendees with practical insights into how this asset class can address economic challenges and become a strategic component in investment portfolios.