Quarterly Index Review – results
The third Index review of 2022 resulted in 27 changes to the FTSE EPRA Nareit Global Real Estate Index series. The final results of the Q3-2022 Index review presented 12 additions, 5 deletions and 9 reclassifications and were effective the 19th of September 2022. The net added value added to the global index amounted to EUR +12,395 million in free float market cap.
Starting with the Developed Index, there have been 10 additions. 4 additions on the EMEA region: “Home Invest Belgium REIT Ord Shs” (Belgium, Rental, REIT, Residential), “Residential Secure Income PLC” (UK, Rental, REIT, Residential), “Warehouse REIT PLC” (UK, Rental, REIT, Industrial) and “Stendorren Fastigheter Ord Shs Class B” (Sweden, Rental, Non-REIT, Industrial). 3 additions on the APAC region: “Healthcare & Medical Investment” (Japan, Rental, REIT, Healthcare), “Sekisui House” (Japan, Non-Rental, Non-REIT, Diversified) and JR Global REIT (Korea, Rental, REIT, Office). And 1 addition on the Americas region: “NETSTREIT Corp” (Americas, Rental, REIT, Retail). In terms of deletions, 2 companies were excluded from the Developed Index both from the Americas Region and both due to size fail: “Dream Office Real Estate Investment Trust” (Canada) and “Industrial Logistics Properties Trust” (USA).The developed index also faced a total of 5 reclassifications among which we can highlight the REIT status acquisition of “Sirius Real Estate” (UK, Rental, Industrial/Office Mixed). The rest of the reclassifications were sectors changes from the “Diversified” to a more specific sector.
Continuing with the Emerging index, there have been 4 additions. 2 on the EMEA region: “Jadwa REIT Al Haramain Units” (Saudi Arabia, Rental, REIT, Lodging & Resorts) and “SICO Saudi REIT Units” (Saudi Arabia, Rental, REIT, Lodging & Resorts), 1 on the APAC region: “Mindspace Business Parks REIT” (India, Rental, REIT, Office) and 1 on the Americas region: “SYN prop e tech SA” (Brazil, Non-Rental, Non-REIT, Diversified). Regarding the deletions, there has been 3 exclusions:1 in the EMEA region: “Vukile Property Fund” Due to holding fail and 2 exclusions in the APAC region: “Redsun Properties Group” and “Zhongliang Holdings Group” both from China and both due to size fail. The emerging index faced 4 reclassifications among which we can highlight also the REIT status acquisition of “Quality Houses Leasehold Prop” (Thailand, Non-Rental, Non-REIT, Residential), the rest were sector changes.
For further information on all the changes occurred to the Index review, please check the “Corporate Actions Historical” excel file that can be found on the EPRA’s website.
The next index review will take place at the end of November, with the initial results announcement on December 2nd, 2022, after the close of business in the US, and the final results locked-up on December 19th, 2022, after the close of business.
H1 2022 Edition of Real Estate Barometer on European LRE markets
EPRA and Euronext partnered up again for the publication of the latest Real Estate Barometer covering the key trends and figures of the real estate companies listed on Euronext’s capital markets. Download the H1 2022 report for key insights on performance, the impact of recent geopolitical and economic risks on the real estate sector. Read more here.
Global Real Estate Total Markets Table Q3 2023: markets lost momentum
EPRA published the Global Real Estate Total Markets Table with updated Q3 2022 figures. The largest markets are Germany (EUR 68 billion), the UK (EUR 65 billion), and Switzerland (EUR 53 billion) which took the third place from Sweden (EUR 47 billion) in Developed Europe region. Focusing on annual changes, all countries lost momentum after two consecutive tough quarters and saw a decrease in market size. As a consequence, all countries in Developed Europe are now below the pre-Covid19 levels, relatively limited for Switzerland (-11%) and Belgium (-12%).
At the end of Q3 2022, the total value of the listed real estate sector in Developed Europe was EUR 355 billion, of which 61.6% is represented in the FTSE EPRA Nareit Developed Europe Index. You can download the full report here.
EPRA Blog: IPO's, Interest rates, Inflation and Sector comparison
In July, August and September EPRA continued discussing topics of high importance for the industry and presenting some ideas for looking at the current market conditions in a very light and simple format, its blog. This is just the continuity of a big effort started earlier this year for getting more visibility for the European real estate by using different approaches and platforms. This time the analysis was focused on the current challenges for the industry facing high inflation and rising interest rates as well as a wide comparison against other listed sectors looking at different indicators like Total Returns, P/E, ROA, and Debt/Assets. The blog is accessible and open for everyone on EPRA’s website.
EPRA - Bayes Education Programme: Understanding the REIT price
Following the success of the first course in April, registration for the second running of the 6-week online course collaborating with Bayes Business School was launched. The programme is designed for property and finance professionals working for listed real estate firms, real estate private equity teams and equity/multi-asset/property analysts/fund managers who are looking to enhance their knowledge of real estate as an asset class with a deep dive into what really drives REIT pricing, the mechanics of the buy-side and sell-side, specific investor requirements, valuation and price target models and a lot more. The programme started in the week of 17 October 2022. Download the brochure here and for more information, please contact education@epra.com.
2023 Research Agenda
The EPRA Research Committee September meeting took place in Paris during the annual conference. Following themes are identified for the 2023 research agenda which will be covered by academic, practitioner and in-house research papers and webinars:
• The impact of structural vs cyclical changes on the sector
• The role LRE in multi-asset portfolios and how do get generalists more involved in the sector?
• Volatility, potential opportunities and implications for LRE
• Valuation, challenges and potential implications for LRE
• Understanding of company profiles from financial aspects
• Impact investing and strategies
• PropTech and virtual real estate, implications for LRE
The annual Call for Research Proposals 2023 is now open for registration. You can do this via following link. The deadline for submissions is 23:59 CET on Friday, November 4, 2022. EPRA welcomes submissions from both academic researchers and market practitioners. For more information, please reach out to research@epra.com
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