Non-listed real estate: what the guidelines expect

Investors in non-listed real estate vehicles see performance largely through appraisal-based values. There is no daily share price to anchor expectations; the net asset value moves when valuations move. The industry’s frameworks therefore concentrate on how those values are produced — who values, how often, and to what standard. Three sets of guidance matter most for investors weighing up a vehicle, and each makes its demands in a different way.

INREV: comply or explain

For non-listed vehicles in Europe, the closest fit is the INREV Guidelines’ Property Valuation module, which operates as best practice on a comply-or-explain basis. It defines market value as defined by the International Valuation Standards (IVS), and its requirement PV02 states that external valuers should comply with recognised international standards such as IVS, RICS and EVS. The comply-or-explain mechanism matters for due diligence: a manager either follows the practice or explains why not, and both answers are informative.

EPRA: the listed counterpart

Listed real estate companies face parallel expectations. EPRA’s Best Practices Recommendations (September 2024) recommend that companies use an external valuer at least annually, and state that valuations should be in accordance with the International Valuation Standards. These are recommendations rather than binding rules — but they shape what investors in listed real estate have come to expect, and that expectation travels readily into conversations about non-listed vehicles too.

MSCI: the measurement layer

Performance measurement adds a third layer. MSCI’s Global Data Standards for Real Estate Investment adopt the IVSC valuation standards as the preferred basis for reporting capital and rental values for performance measurement purposes. Preferred, not required — but for investors comparing funds through benchmarks, a common valuation basis is what makes the comparison meaningful in the first place.

Three frameworks, one direction

The scopes differ, but the direction is the same: independent valuation, regular cycles, and recognised international standards. Beneath all three sits the standards framework itself — the International Valuation Standards, including IVS 400 Real Property Interests, which govern how the valuation work is scoped, performed and reported. The RICS Red Book Global Standards, which apply to RICS members and regulated firms globally, fully incorporate IVS, with the current edition effective from 31 January 2025. For an investor doing diligence on a vehicle, the practical questions are simple: which framework does the manager follow, how is compliance evidenced, and what happens when practice departs from it?

Read together, the frameworks give investors in non-listed real estate a usable checklist. None of them removes judgement from valuation, and none of them needs to. What they do is make the judgement visible: who exercised it, against which standard, how recently, and with what independence. In a market where the reported value is the performance, that visibility is most of what confidence is built on.