With a performance-based management contract, an asset manager's fees are tied directly to the rate of return earned by investors on the portfolio of managed properties relative to a benchmark. In private commercial real estate, the choice of benchmarks for performance is limited in large part to return indices provided by which of the following organizations?
A) Standard and Poor's
B) National Association of Real Estate Investment Trusts
C) National Council of Real Estate Investment Fiduciaries
D) Wilshire Associates

Question

Quizplus · Accepted Answer

The National Council of Real Estate Investment Fiduciaries (NCREIF) provides widely used performance indices for private commercial real estate. These indices are based on actual investment performance data from institutional real estate investors and are considered the most reliable benchmark for private commercial real estate performance. Standard and Poor's provides benchmarks for public real estate investment trusts (REITs), while the National Association of Real Estate Investment Trusts (NAREIT) provides industry data and analysis for all types of REITs. Wilshire Associates provides investment consulting and analytics services but does not specialize in real estate performance benchmarks.

With a Performance-Based Management Contract, an Asset Manager's Fees Are