Thought Leadership
Navigating 2025 Market Volatility: Why Private Real Estate May Offer Stability for Investors
The public markets are experiencing high volatility—driven by sweeping tariffs, geopolitical uncertainty, and investor anxiety around a potential economic slowdown. In this kind of environment, many high-net-worth investors are re-evaluating their asset allocation strategies. One increasingly popular question: Is it time to move beyond the public markets? While publicly traded REITs (Real Estate Investment Trusts) offer exposure to real estate, they behave more like stocks than the underlying real estate itself. This is because public REITs trade on exchanges and are subject to the same sentiment-driven swings as the broader equity markets. This disconnect highlights the key difference between public REITs and private real estate investments: private real estate is less correlated to public markets. At MLG Capital, we track and compare the performance of public equities, REITs, and private real estate using trusted benchmarks like the S&P 500, the IYR ETF (for public REITs), and the NCREIF Property Index (for institutional private real estate). Historically, and continuing into this volatile 2025 environment, private real estate has shown considerably lower volatility and less correlation with the ups and downs of the stock market. Overexposure to highly correlated, and currently volatile assets, may result in increased risk when compared with a...
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