Last Updated on July 7, 2026 by

Real estate behaves differently from shares or bonds. It generates returns differently, moves to different rhythms, and requires a different mindset. This article explains what that means in practical terms, so investors can make better informed decisions.

Different Investments, Different Timelines
Broadly speaking, investments fall into two categories:

An investment in a property fund is in the second category. This doesn’t make one type “better” – they serve different purposes. Liquid assets offer flexibility. Real assets offer a different kind of stability through income and physical use.

How Real Estate Generates Returns
Property investments typically generate returns from two sources:

1. Rental Income – Tenants pay rent under lease agreements. For grocery-anchored retail, people continue to buy food in most economic environments, which can support consistent tenant demand.
2. Property Value Changes – The market value of buildings may rise or fall over time, influenced by factors like interest rates, property condition, and location.

For essential retail property, income is generally the primary driver of long-term returns. It is important to recognise that property values can fall as well as rise, higher interest rates can reduce valuations, and tenant performance matters. Like any investment, real estate carries risk.

What Does “Defensive” Really Mean?
Grocery-anchored real estate is often described as “defensive.” In practical terms, this means supermarkets provide essential goods, grocery spending tends to hold up during economic downturns, and rent collection in this sector has historiclly been more resilient than in some other property types.

“Defensive” does not mean risk-free. It means the income profile has historically been less sensitive to economic cycles than some other sectors.

How Liquidity Works in Property Funds
Shares can be sold in seconds. Buildings cannot. Selling a commercial property takes months – involving valuations, legal work, buyer negotiations, and financing. This is not a flaw in property investment; it is a fundamental characteristic of owning physical assets.

Because of this, open-ended property funds use liquidity management tools to protect investors. These may include notice periods for redemptions, cash reserves, limits on how much can be redeemed at one time, and temporary redemption gates. These tools are standard in real estate funds across Europe and exist to prevent assets having to be sold quickly at discounted prices during periods of elevated redemption requests.

One of the Greenman Real Estate funds, Greenman OPEN, is currently operating under a gating mechanism, as provided for in its fund rules. Gating does not mean the assets have stopped performing. Rental income continues to be collected, and scheduled distributions continue where applicable. It reflects the reality that property is an illiquid asset class requiring careful management. For up-to-date information on OPEN’s current position, refer to the fund’s most recent communication.

Why a Long-Term Horizon Matters
Real estate investment works best over time. The strategy typically involves securing long-term leases, improving building quality and sustainability, managing tenant relationships, and making upgrades that enhance value gradually – not overnight.

Real estate investments are generally more suitable for investors who have a multi-year horizon, are seeking income rather than quick capital appreciation, and do not need immediate access to their capital.

• The value of investments can go down as well as up
• Property values can fluctuate, particularly in response to interest rate changes
• Liquidity in real estate funds can be limited, and redemptions may not be immediately available
• Real estate funds structured as AIFs and ELTIFs are long-term investments and are not suitable for investors who require short-term liquidity
• Past performance is not a reliable guide to future results
• Distributions are not guaranteed and may vary

This article is for informational purposes only and does not constitute investment advice. Investors should consider their personal circumstances, read the relevant fund documents including the Key Information Document (KID), and where appropriate, seek independent financial advice before investing.