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Purpose -Since the mid-1990s, in a generally strongly performing property market, there has been huge growth in the aggregate size and number of global property funds in both listed and unlisted formats. Managers have been able to raise significant capital, which potentially rewards them with performance fees without necessarily being able to provide clear evidence of out-performance against defined market benchmarks or performance targets. In a more challenging, mature and increasingly transparent market this is unlikely to continue to be the case as it will be increasingly possible to assemble performance records. The purpose of this paper is to describe the sources of risk and return within property funds and set out a more holistic performance attribution framework encompassing the concepts of alpha (out-performance) and beta (risk), which traditional attribution frameworks in property fund management do not. Design/methodology/approach -A four component risk and return attribution framework is put forward. The first two components are portfolio structure which measures the impact of allocations to more or less risky markets, and stock selection which considers more or less risky assets. Fund structure, measures the impact of financial leverage and fees and finally the return impact of timing is attributed to the movement of capital into and out of the fund. Findings -A case study of a single unlisted fund has been used to compare traditional attribution results with an examination of alpha and beta return attribution. In this instance fund structure, which is largely the financial leverage impact, is found to be significant. This simply reflects extra risk taking and there is no clear evidence of manager out-performance, yet significant performance fees are paid to the manager. Originality/value -The paper provides a complete framework for the performance measurement and attribution of property funds, which enables investors to gain a fuller understanding of these increasingly used investment conduits.

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