Indicator of direct property will be a aggregation of company’s indices for the UK, Germany, France, Sweden, Netherlands, Ireland, Finland and, later, Denmark
Investment Property Databank, the performance benchmarking company, is to launch the first European property indicator for direct property next month. It is also adding Finland and Denmark to its national performance indicators. The European indicator will be an aggregation of IPD’s current indices comprising the UK, Germany, France, Sweden, Netherlands, Ireland and Finland with Denmark to be added at a later date.
Speaking at the IPD/GPR European Strategies Conference in Wiesbaden last month, Tony Key, research director for IPD, said the index would be a first stage while performance coverage improves across the 15 main European countries, giving investors a first chance “to see what a European indicator looks like.” Key said the European indicator was a natural next step, given that “investors look at things across the Continent and have portfolios across several countries.” The index is expected to be available in July and including Denmark will cover around 33,000 properties with a capital value of around €330bn.
For the Finland index, IPD has formed an alliance with KTI, the Institute for Real Estate Economics. KTI was founded in 1993 by the Turku School of Economics, the Finnish Real Estate Federation and the Real Estate Associations of Helsinki. The index covers €7.8bn of assets in 1,562 properties representing around 50% of the market.
In Denmark, IPD is working in conjunction with ED, the Danish property federation. IPD will analyse the data with ED working as a marketing and client liaison partner. The company is also looking at the feasibility of introducing indices in Spain, Portugal and Belgium. IPD aims to produce a more comprehensive index within three to five years but has to surmount obstacles such as emergent valuations standards and standardisation of performance measures.
