Core Capital Fundraising Up 3x, Signals Broader Recovery

Core capital fundraising tripled in 2024, reaching over $10B compared to $2.5B in 2023, per Cushman & Wakefield.
Core and core-plus funds now account for 12% of capital raised, the highest since the post-Great Financial Crisis (GFC) era in 2010.
Multifamily core investments outperformed expectations in Q3, with unlevered IRR targets rising as underwriting stabilized.
Core capital often leads broader CRE market recoveries, signaling potential growth in value-add and opportunistic strategies in coming years.

Key Takeaways

Core capital investment, known for its low-risk, high-quality assets with stable cash flow, has tripled YoY, a signal of renewed confidence in CRE, per GlobeSt.

According to Cushman & Wakefield, closed-end core funds pulled in $10B in 2024, far surpassing $2.5B in 2023.

Notably, core capital is often the foundation of CRE investment cycles. After a period of volatility and investor pullback, a surge in core capital suggests the market is regaining its footing.

Multifamily Outperforms

Multifamily investments played a key role in this resurgence. CBRE reported “substantial movement” in unlevered IRR targets for core assets, with Q3 performance exceeding expectations. By Q4, underwriting stabilized, reinforcing investor confidence.

Multifamily’s strong fundamentals—rising rents, stable occupancy, and resilient demand—helped attract capital back to core strategies. This suggests investors see long-term growth potential in stabilized, income-producing properties.

Core Capital Recovery

Historically, core capital leads the recovery following market downturns. After uncertainty, investors often seek safe, dependable assets before moving into higher-yield strategies like value-add and opportunistic investments.

According to Abbey Corbett, Senior Economist at Cushman & Wakefield, core capital is the “tip of the spear” for CRE capital flows, influencing how investors allocate funds across different strategies.

In 2010, after the Great Financial Crisis, core funds captured 20% of capital raised.
In 2024, core and core-plus closed-end funds hold 12% of total capital, the highest since 2010.

This resurgence paves the way for future transactions as value-add and opportunistic investors anticipate selling to new and existing core funds in the coming years.

Ripple Effect For CRE

The growth in core capital creates competition for value-add investors, who may need to act now before pricing increases. As fund managers deploy capital, expect:

Rising demand for stabilized assets, particularly in multifamily and industrial sectors.
More liquidity in the market, allowing distressed or transitional assets to stabilize.
A gradual shift to value-add and opportunistic deals, as core investments signal improving fundamentals.

While challenges remain, the strong rebound in core fundraising suggests that CRE capital markets are turning a corner, positioning 2025 for renewed investment activity and growth.