Is it true that the total risk premium for bonds is the lowest, for equities its the highest, and real estate being somewhere in between? If yes, what risk premium causes equities risk premium to be over that of real estate?
Generally, direct real estate investments should command a higher required rate of return than equities, since it will also include a risk premium for illiquidity.
Private real estate will be far higher than equities. There’s illiquidity, low info transparency with respect to information available & high risks with respect to brokering a suitable deal to liquidate the property.