Key Takeaways
- • The PGIM Global Real Estate Fund Class Z outperformed the FTSE EPRA/NAREI Developed Real Estate Net Index in October, driven by strong stock selection while asset allocation remained neutral.
- • Europe was a drag on results, with underperformance largely attributed to poor stock selection in the U.K.
- • The fund is overweight Japanese developers, citing positive fundamentals and improving shareholder returns.
- • U.S. REITs trade at about a 6% discount to net asset value, versus a long-term average closer to flat, and the manager anticipates roughly 6.5% earnings growth in 2025, rising to 7% thereafter.
Summary
The PGIM Global Real Estate Fund's Q3 2025 commentary reports that its Class Z share class outperformed the FTSE EPRA/NAREI Developed Real Estate Net Index for the month of October. The outperformance was driven by strong stock selection, while asset allocation was neutral relative to the benchmark.
Regionally, Europe weighed on results. Underperformance there was largely attributable to poor stock selection in the United Kingdom.
In North America, the commentary states that U.S. real estate investment trusts (REITs) remain attractively priced, trading at about a 6% discount to net asset value (NAV). By comparison, the long-term average is closer to flat. The manager anticipates earnings growth of roughly 6.5% in 2025, improving to 7% in the following period.
On positioning, the fund is overweight Japanese developers, which the manager attributes to positive fundamentals and improvements in shareholder returns.
Regionally, Europe weighed on results. Underperformance there was largely attributable to poor stock selection in the United Kingdom.
In North America, the commentary states that U.S. real estate investment trusts (REITs) remain attractively priced, trading at about a 6% discount to net asset value (NAV). By comparison, the long-term average is closer to flat. The manager anticipates earnings growth of roughly 6.5% in 2025, improving to 7% in the following period.
On positioning, the fund is overweight Japanese developers, which the manager attributes to positive fundamentals and improvements in shareholder returns.
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