A team of undergraduates from the Terry College of Business outperformed 37 other university competitors to capture first place in the 2017 Real Confidence University Challenge, an annual real estate investment contest sponsored by the Altus Group.
The four-member team won the $30,000 grand prize for managing the best commercial real estate investment portfolio with a return of 35.38 percent over four quarters ending in 2017.
The team’s strategy of investing in infrastructure projects generated the big return, said Andrew Kahn, who was the team’s captain last year and has since graduated in real estate and finance.
“We initially narrowed our potential capital allocations to the industrial, timber and infrastructure sectors,” Kahn said. “In the two years prior, portfolios with 100 percent allocation to the Industrial sector performed well, but we wanted to differentiate ourselves from the competition and further increase our risk profile. Our research indicated the best chance of victory was to maximize risk and invest 100 percent in infrastructure.”
The Real Confidence University Challenge is a theoretical exercise, asking teams to allocate $1 billion among a variety of commercial real estate investment opportunities found within the public and private equity market and the public and private debt sectors.
The Terry team submitted their portfolio late in 2016, and judges scored their quarterly investment performance throughout 2017.
“The competition gives students insight into how some well-known indices work as well as a familiarity with the process of creating an investment portfolio,” Hayunga said. “I teach them some portfolio theory, but the students do their own research and put together a product they think has a chance to win.”
“Through the University Challenge, we aim to support future industry professionals, and we’re so pleased to see the number of schools participating continues to increase each year,”said Rick Kalvoda, senior executive vice president at Altus Group.
Terry College is one of 47 teams entered in the 2018 University Challenge.