EXECUTIVE SUMMARY

• A panel data regression analysis was undertaken on a unique, unbalanced panel of APAC non-listed real estate funds to determine the role of leverage in hedging against actual and unexpected inflation with a focus on core funds.

• There is evidence that APAC non-listed real estate funds provide hedging against inflation and that the use of debt enhances their hedging capabilities.

• Furthermore, the results show that while leverage enhances a fund’s inflation hedging capability at moderate levels, its benefits are not unrestricted.

• The results imply that investors can extract information about inflation hedging abilities of non-listed real estate funds from capital structure data, promoting efficient investment decisions.

• The significance of the results may be influenced by the size of the dataset (119 APAC non-listed real estate funds invested in more than 10 countries across the three styles over the period of 2006-2014).