EPRA Chief Sees Little Impact from Greek Debt Crisis on European Property Markets

Philip Charls, CEO of the European Public Real Estate Association (EPRA), joined REIT.com for a video interview during NAREIT’s 2015 Washington Leadership Forum.

EPRA’s mission is to promote, develop and represent the European public real estate sector.

Charls discussed the potential impact of the ongoing Greek debt crisis on the European property markets. He observed that Greece represents less than 1 percent of the overall European economy. Also, Europe is in a much better state than it was four or five years ago, making any possible exit of Greece from the eurozone less damaging than it would have been in the past, Charls said.

Charls stressed he did not envision Greece leaving the eurozone: “I do think there will be a compromise that will solve the problem.” Underscoring that prediction, he noted, are the solid gains posted by European stocks so far this year.

Charls also commented on the flow of European property companies into the public markets.

“At the moment, we are doing really well in Europe,” Charls said. Last year, Europe had a record number of initial public offerings (IPOs), he noted. He added that real estate companies accounted for a 12 percent share of total IPO funds raised. “That has never happened before,” he observed.

Charls attributed the trend to the stronger economy, a dramatically higher allocation of funds to real estate, and the growth of REIT regimes  in countries such as Ireland and Spain.

Meanwhile, Charls said he is also seeing a trend toward consolidation in the European public real estate market.

“We really are getting more U.S.-type companies,” he noted. As an example, Charls pointed to the recent merger of French retail landlord Klepierre SA and Corio NV, which has now resulted in a second big retail player in Europe.

Looking ahead to EPRA’s priorities for 2015, Charls said the organization will continue to focus on education and investor outreach. In addition, Charls said EPRA will promote the improvement of REIT regimes in Italy and elsewhere, while also helping countries such as Poland develop a REIT regime.