30 December, Milano Finanza
The assets for property funds is growing, amounting to 50 billion euro in Italy, with a growth of 4.2%, according to the numbers provided by Scenari Immobiliari in its latest 2017 report “Property funds in Italy and abroad”. In the main European countries (France, Germany, Great Britain, Italy, Luxemburg, Netherlands, Spain and Switzerland), 2017 “should close with assets for over 550 billion, with an increase of about 8% in comparison with last year”. The growth of the Italian property market, “having left behind a long crisis, confirms the good trend of the property funds sector (407 active funds).
According to the outlook, the net asset value in Italy will be close to 50 billion by the end of the year”. This is a “higher stock than those of the insurance, pensions and banking sectors. It has increased by 4.2% from last year. The direct real estate assets amount to nearly 55 billion euro, development operations included”. The outlook for 2018, stresses Scenari Immmobiliari, “is for a slight increase of the NAV and of the assets since the exit flow will be negative. By the end of the year, the balance is meant to be positive, even though with the presence of the new international operators”.
In a context of stability or of slight growth characterising some countries such as Italy, Netherlands and the German open-end funds, “The growth is more prominent in other markets. It’s the case of the German reserved funds, the French non-listed funds, and the special purpose companies of Luxemburg”. The main European real estate markets “confirm the positive phase started in 2016.
Despite an uncertain economic and political situation, the turnover for real estate has grown in the overall, except for Great Britain, where the Brexit effect with the consequent halt of activities caused a significant contraction”. Italy and France have registered “an increase aligned with the trend of 2016, but at a faster pace in 2017. Germany showed a stabilization phase, while Spain registered a fast-paced growth, which is meant to last for the next two years”.
The residential sector, according to the president of Scenari Immobiliari, Mario Breglia, “is growing in several markets, with an increase of transactions on the overall, mostly driven by the positive trend of old properties, representing two-thirds of the total transactions. There is also a growing interest for the segment as asset class, especially from the American institutional investors, which have invested in the last two years about half of their total investments in Great Britain, and they have recently increased their purchases in continental Europe.
Breglia adds that “the price trend is also increasing in most of the European countries and some of them, like Romania, Germany and Sweden, are at the first places in the global chart for yearly increase. 2017 represents the breakthrough for Italy, even though not for all its territories. London showed a negative performance with prices dropping by 3%-9% and the outlook is still uncertain”.
The Italian financial real estate, notes Scenari Immobiliari, “is composed of real estate assets for about 62 billion euro (increased in comparison with the 60 billion of 2016), divided between funds dedicated to public retail, funds dedicated to institutional investors, siiq and listed real estate companies”. On the overall, “the sector, at the date of 30th June, has reported a total capitalization (including retail funds, siiq and listed real estate companies) of approximately 3.7 billion euro”.
Source: Milano Finanza
Translator: Cristina Ambrosi