A report from consulting firm Ernst & Young Global Limited said private equity has made a comeback in the real estate markets. The revival finally occurred after a five-year dearth. Ernst & Young added that the real estate private equity sector is poised to grow next year.

In a statement, Mark Grinis of Ernst & Young's Global Real Estate Fund Services said, "Private equity funds are heading down a path toward growth. What remains to be seen is if they are in for a brisk morning walk or just a Sunday stroll."

The report said about half of the investment capital will go to the top 10 private equity real estate funds. That leaves around 400 funds scrambling for the remainder of the capital. This situation would place investors in the driver's seat as far as allocations are concerned, Grinis said.

Despite the comeback, a report from the International Business Times said private equity could still have a hard time gaining foothold in gateway cities. Competition in the expensive real estate markets in Hong Kong, London and New York remained intense.