Luck vs. Skill in Real Estate Investing


One of the most rewarding parts of being faculty at Booth is the involvement we have with students. This past year, I worked with a team of five students on a year-long commercial real estate investment competition, which allocates $1 billion in theoretical funds to student groups from 32 different universities competing for the highest portfolio return. We’re very excited that our team took first place at the 2016-17 Real Confidence University Challenge. The team won $30,000, which will be presented at the end of October at Booth’s annual Real Estate Conference.

It was a pleasure to see the students put their training from Booth’s real estate (and other) classes to good use. Though the team members came to the competition with varying perspectives on what constituted the optimal portfolio allocations, they vetted the various proposals in a manner that led to a well-reasoned allocation. And while it is very encouraging to see the Booth team outdistance so many competing schools, we suffer no delusions: besting the market over a one-year horizon is part luck and part skill.

In another recently posted blog, a couple of our team members go into the thought process behind their approach and the strategy they implemented. Read their blog »


Prof. Joe PagliariJoseph L. Pagliari Jr. is Clinical Professor of Real Estate at Chicago Booth. Professor Pagliari's research focuses on answering important real estate investment questions from a rigorous theoretical and empirical perspective. He co-authored several chapters in the Handbook of Real Estate Portfolio Management, of which he is also the editor. In addition, he has co-written material published in Real Estate Investment Trusts, Pension Fund Investing, and Megatrends in Retail Real Estate. Professor Pagliari serves on the editorial advisory boards of the Journal of Real Estate Research and Journal of Real Estate Portfolio Management. At Booth, he teaches Real Estate Investments I & II and the Real Estate Lab.