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What is core private real estate?

  • Thomas Miller for USQ


    Thomas Miller

    Managing Director
    USQ Interval Funds

    Kennett Square, PA


Core private real estate refers to a category of real estate investments that are typically considered to be the highest quality and least risky within the real estate risk spectrum. Core real estate assets are typically located in large or growing markets and have high occupancy levels with long-term leases held by creditworthy tenants. Additionally, core assets are typically financed using a prudent amount of debt in the capital structure. The asset class generates the majority of returns from income, and to a lesser extent, capital appreciation.

As we explore the five defining features of core properties, we’ll reveal how prudent financing, reliable income streams, and a commitment to long-term holding converge to shape the asset class.

Low angle view under a glass staircase

Characteristics of core properties

Prime locations and amenities

Core properties are strategically located within top MSAs and markets that are growing. These can be characterized by strong economic stability, job growth, population growth (typically highly correlated with job growth), well-developed infrastructure, technology or innovation hubs, well-educated workforce, and/or investor-friendly regulations.

The amenities associated with core real estate typically include high quality finishes, local access to public transportation, advanced technological infrastructure (such as high-speed internet and advanced HVAC systems), fitness centers, modernized meeting spaces, and concierge services.

The emphasis on prime locations coupled with highly-amenitized features helps core real estate remain attractive and desirable, contributing to the stability and potential appreciation of the investment.


Core private real estate investments prioritize stability through long-term lease agreements with creditworthy tenants. The income generated from these leases provides a reliable and steady cash flow, making core properties resilient to short-term market fluctuations and providing a hedge against inflation. This stability is particularly attractive to investors who seek consistent returns without exposing themselves to excessive risk.

Learn more about private core real estate from USQ's experts

Potentially lower risk

Core real estate investments are considered to be a conservative investment approach due to their low leverage and focus on high-quality stabilized properties. These properties are meticulously chosen for their strong fundamentals, such as high-quality tenants, proven income-generating potential, and historical resilience. The lower-risk nature is also a result of conservative financial management, which involves maintaining reasonable levels of leverage and avoiding aggressive financing strategies.

Prudent financing

Core private real estate typically utilizes modest leverage - generally less than 35% LTV. Additionally, depending upon the environment, the debt that is held is fixed rate (or hedged) to mitigate the volatility of interest rate swings. This leverage profile allows core investors to weather most economic environments.

Long-term holding

The core private real estate strategy involves a patient, long-term approach to investment. Investors in core properties are willing to commit to extended holding periods, typically a minimum of at least 7-10 years, recognizing that the value and income potential of these assets often increase over time. This approach aligns with the idea of enduring market cycles and attempts to capture the benefits of consistent, long-term income while also providing a hedge against inflation.


Core real estate investments are a cornerstone of a diversified investment portfolios. Click here to learn more about how diversifying with core private real estate can benefit a portfolio.

Make core real estate work for you

Contact USQ's experts to find out how.

Risk Disclosures

Union Square Capital Partners, LLC is an investment adviser registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940. Past performance does not guarantee future results.

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