The European non-listed real estate fund market saw positive performance for the third quarter running in Q3 2013, with total returns of 0.82 per cent, according to INREV’s latest quarterly index.
Value added funds outperformed core for the second quarter in a row, with value added at 1.24 per cent compared to 0.74 per cent for core in Q3 2013.
Closed end funds continued to outperform open end funds, posting total returns of 0.92 per cent and 0.77 per cent respectively.
Although performance for Southern Europe is improving, with returns at -0.91 per cent compared with -3.58 per cent during the previous quarter, Western Europe outperformed at 1.14 per cent.
Industrial/logistics (1.76 per cent) and retail (0.85 per cent) were the best performing sectors in Q3, while office (-0.76 per cent) and residential (-0.37 per cent) both posted negative returns.
Star country performers in Q3 included the UK (2.23 per cent), Finland (2.07 per cent) and France (1 per cent). Returns in Germany went from positive in Q2 to negative in Q3 (-1.08 per cent), while the Netherlands showed a fifth consecutive quarter of negative returns (-0.21 per cent). The negative return in Germany was driven by a couple of funds winding down.
Casper Hesp, director research and market information, INREV says: “A third successive quarter of positive returns should give the industry further cause for optimism. In particular the marked improvement for value added funds in Q3 is very encouraging.
“The continued strong performance of value added funds and significant variances in rates of return across countries and sectors suggest that investors will need to take a differentiated look at the market as we enter 2014."