Uncertainties determine the real estate markets in 2017. The asset class real estate outperforms bonds and shares in the expectations. Lack of yield alternatives lead to a slight increase in risk appetite.
Frankfurt am Main, 13. März 2017. The Study Professionals‘ Real Estate Investment Report from VERIANOS, since 2012, VERIANOS compares the most important economies of the EU (Great Britain, Germany, France, Italy and Spain) with the USA, Japan, China and Australia from a real estate perspective. This year’s survey involved 160 experts from the real estate and financial sectors, primarily from Germany and the United Kingdom. This year’s study was developed in collaboration with IntReal.
Overall, the results show a rather skeptical basic assessment. Only Germany and the USA are regarded as safe investment ports. All markets analyzed fare worse than in the previous survey. The UK’s rating has changed dramatically compared to the positive trend of previous years. 69.3% of the respondents rate the country’s economic outlook negatively and 51.4% recommend reducing the investment portfolio. For the first time in this study, China is expected to put a damper on economic development.
A turnaround compared to previous years is the assessment of real estate as the most promising form of investment for future investments. In all years before, both bonds and shares were much higher in the favor of respondents.
In the search for a return, the willingness to take on an increased risk increases. 54% of respondents recommend investing in Core + properties, and 57% in Value Add. After all, 40% of the survey participants want to increasingly consider opportunistic investments.
Logistics, housing and commercial real estate (such as hotels, nursing homes) are the preferred market segments for the coming year. Above all, however, VERIANOS Research sees this as a catch-up effect against the background of the shortage of supply in the traditional real estate segments office and retail, which was again intensified last year.
Although the Debt Fund theme has been debated for several years, the findings of the Real Estate Investment Report professionals show that there is little practical experience with this topic. Three-quarters of respondents had no direct exposure to debt funds. Opportunities are given to this financing instrument, especially for complex projects, if the needs of the medium-sized real estate industry are taken into account.
VERIANOS is an independent real estate merchant banking partnership based in Frankfurt and Cologne and offices in Milan and Madrid. With the investment and advisory business units, we realize individual investment products and sophisticated advisory and financing mandates for clients.
IntReal is the first service KVG focusing exclusively on the creation and administration of real estate funds for third parties. The fully licensed KVG is one of the leading providers of real estate KVG services with 83 funds and over € 13.5 billion in assets under administration.
VERIANOS Real Estate Aktiengesellschaft
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