Overview: This article explains about real estate investment, which represents a significant part of many institutional investors portfolios. Since real estate is not directly traded on a centralized exchange, the physical real estate market is characterized by relative lack of liquidity, large lot size, and high transaction costs with properties that are fixed at a location and heterogeneous. The article focus of the academic research on real estate investment lies in three principal areas: 1) indexing, benchmarking and measurement issues in the real estate market; 2) the risk-return and diversification properties of real estate investment, both internationally and within specific markets and asset allocation issues; and 3) the economic determinants of returns in real estate and these are explained in detail under this article.