The growth of real estate funds in Europe
Real estate funds are growing in Europe, favored by an improvement in the actual economic prospects, by the poor consistency of bond yields and by a substantial liquidity, and to date constitute a wealth of over 517 billion euros for Brussels.
These and others are the data of the 30th Scenari Immobiliari report on “Real estate funds in Italy and abroad” , presented in Milan this June. If we consider the operational assets (nav) of the main countries, we have seen an average growth of + 7.3% in the period 2010-2013, and a constant acceleration, with a + 9.8% in 2014, a +10.8 % in 2015 up to 12.4% last year. Sol0 for Italy, the assets of the funds has reached 46 billion euros and is aimed, for 2017, at 50 billion with over 400 real estate funds.
If we examine the 8 main countries
(France, Germany, Great Britain, Luxembourg, Holland, Spain, Switzerland and Italy), for 2016, a total of 517 billion euro of real estate funds has closed. The operators of the sector expect, for the current year, a further growth of around 4%, and the trend of the first four months seems to confirm these figures.
Mario Breglia, President of Scenari Immobiliari – Independent Institute of Studies and Research – intended to specify: “ On the asset allocation front, the management companies are increasingly oriented towards asset turnover, to follow the new needs of the markets. Among the emerging markets at European level, especially the residential one, which has an asset allocation share equal to ten percent of the total. The new residential investments are concentrated on the restructuring activity, especially with a view to saving energy, and on specialized residences, in particular for students or seniors “
” More than in the past , Sgr, Società Gestione Risparmio, internationally owned, that use this tool to operate, even intensively, on the national market are expected alongside Italian operators . So the prospects could be better than expected. The cost of money remained very low in 2016 and, despite the slightest signs of growth, the figure added to the debt restructuring operations , allowed a further reduction in the debt of the system, which fell by 30 billion euros in five years to 25.5 billion. The number of operational funds has increased and appears to be increasing also in 2017, even net of the liquidations of many “family ” funds .
What are the prospects for the future?
In order to provide an assessment of the perception of the future of the real estate market, and of real estate funds, a questionnaire was promoted among the asset management companies involved. 70% consider an improvement in performance over the medium term (3-5 years). There is also a moderate optimism of the operators, and a moderate growth, relative to the real estate market.
Expectations concern in particular exchanges of offices, shops and residences, for which an increase of up to 10% is expected. The real estate investment will affect the north and central Italy the most, while hotel and tourist development will be high also in the south and on the islands.
The asset management companies expect a greater return from traditional markets
such as residential and commercial, and show no particular attraction for relatively too new sectors for the country, such as RSA, social housing, senior housing, student houses and technology campuses, for which we can expect further developments only in the future.
The entire report can be downloaded from this link, but if you want to know more ask us about Ruggiero!