Institutional real estate investors are pulling back on commercial property investments as many say the cycle has hit its peak. But at least one segment – pension funds – will actually gain more appetite for key assets.

That is the assessment from VTS' Katie Higgins in a piece posted on Seeking Alpha. Higgins cited a survey by the Pension Real Estate Association that indicated pension funds would actually increase allocations into commercial real estate this year. The survey forecasts total returns on commercial real estate will decelerate from 6.8% this year to 5.7% in 2018.

Because of shifting returns, pensions may more be focused on core assets, Higgins wrote. For instance, the AFL-CIO Building Investment Trust just bought a 668k SF industrial facility used by General Motors Co. in Grand Prairie, Texas, according to the Dallas Business Journal. “That deal shows the continued appetite to buy trophy assets in top markets, as well as a growing demand for industrial,” Higgins wrote about the purchase.