Funds which spend their money investing in property funds are attracting a lot of first-time property investors.

According to industry body INREV (the European Association for Non-listed Real Estate vehicles), which surveyed 18 funds of funds managers overseeing 34 vehicles with an estimated target equity size of E14bn (£10.7bn), three-quarters said their funds included investors allocating money to the non-listed property market for the first time.

Dan Fulop, senior vice president with Franklin Templeton Real Estate Advisors and a member of the INREV research committee, said ‘This research shows that the funds of funds market can give both seasoned and first time investors access to the non-listed sector without them having to put the necessary support infrastructure and resources in place or having first-hand experience of real estate investing.’

Pension funds are the predominant investors - 60% - in the funds of funds market, which has grown to E20bn (£15.3bn) of equity since the first fund was launched in 2000. They are followed by insurance companies - 13%.

Co-investment by funds of funds managers represents 1% of the total equity.

The UK is the main origin of capital investing in funds of funds with 28%, followed by the Nordics with 13% and the Netherlands with 12%.