Institutional investors are set to ramp up their exposure to real assets over the next three years, according to a new study by Aquila Capital.

Among real asset categories, property is seen as they type of asset offering the best opportunities, the alternative asset manager found.

In the research, which polled 54 institutional investors based in the UK and Europe at the beginning of February, 21% of respondents said they expected the rise in exposure to real assets would be “significant”.

On the other hand, 7% said they expected to see institutions reducing their exposure during the three-year period in question.

Nearly half (44%) of institutional investors in Europe said they had more than 10% exposure to real assets, according to the study.

Some 41% of respondents said they were positive on the investment outlook for real assets, while 10% were negative.

Property came out as the real asset type offering the greatest investment opportunities over the next five years, with 33% of respondents taking this view.

Next in the ranking came infrastructure, with 18%, followed by commodities, farmland and renewable energy – all with 15%.

The key drivers behind investors’ appetite for real assets were long-term positive cashflows, protection against inflation and portfolio diversification, the research found.

Other factors were the ongoing need for the attractive risk/return profile offered by the investments and growing familiarity with the asset class due to existing allocations.