European Listed Real Estate Performing Well

The listed real estate sector has been doing well in Europe despite the uncertain economic environment, according Philip Charls, CEO of the European Public Real Estate Association (EPRA).

In a video interview with REIT.com at NAREIT's Washington Leadership Forum, Charls discussed the challenges and opportunities in the European real estate market.

"It cannot be denied that there is still a certain level of uncertainty in the European economy," Charls said. "But I think that people place things in perspective every now and then."

He said that the troubled sectors in places like Portugal, Italy, Greece and Spain do not represent even one percent of the EPRA European Index.

"What's important is that the listed sector has been doing extremely well, thanks to the quality of management and the quality of assets. The sector is able to recapitalize itself and is in a much better state than the unlisted sector, so that will give us an opportunity to benefit from future happenings," he said.

While one of EPRA's goals for the year was to focus on and expand the listed open market in Germany, Charls added that it's been very difficult because the German market has its own way of doing things.

However, he said he would not limit the opportunities for growth to those in the German market alone. He noted that there are also growth opportunities in Italy and Spain.

"All three countries are different in their own way. There is distress, but for entirely different reasons," he said. 

Charls explained that while open ended funds are the main issue in Germany, the issues in Spain involve the government. In Italy, the issues revolve around the banks.

When it comes to Germany, Charls added that, thanks to EPRA's educational activities, the country is more accepting of alternatives such as the listed real estate sector, next to the German open ended funds.

"It takes time, but the good news is that the listed sector is in excellent shape at the moment, much better than the non-listed sector," he said.