Germany overtook the UK as the biggest listed property market in Europe in Q1 2018, according to EPRA.
The total size of the German market hit $107.3bn – above the UK’s $100.1bn – and is now the fourth largest in the world, behind the US, Hong Kong and Japan.
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German real estate has consistently outperformed the UK market with total returns hitting 41.2% in the last 12 months, compared with the UK’s 19.6%.
Despite growing larger than the UK, Germany’s market has 36 fewer companies. Its two biggest players – Vonovia and Deutsche Wohnen – have a larger combined market cap than Landsec, British Land, SEGRO, Hammerson and Derwent London put together.
Vonovia also overtook Unibail-Rodamco as Europe’s most valuable property company.
While the UK and Germany have been equally active in IPO activity in the past year, the UK lost about $1.6bn from its market cap when Kennedy Wilson Europe was taken over by its US listed parent Kennedy Wilson in October 2017.
However, the UK’s REIT market is significantly more comprehensive than Germany’s. Of the 100 listed UK companies, 52 are REITs, compared with just five out of Germany’s 64 listed players.
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