GERMANY - The developed countries in Europe continue to offer the best real estate investment opportunities but Germany is perhaps still the best investment even with current pressures, according to London-based Invista Real Estate Investment Management.

Invista based its claim on the results of its latest annual European Property Market Relative Attractiveness report, which ranks countries across Europe against the risk adjusted prospects of their property markets over the coming five years.

In particular, Germany, Italy, France and the Benelux countries topped the list with Spain, Ireland, Hungary and Portugal fading alongside the UK, which was displaced by Germany as the region's most promising real estate market going forward.

Invista believes the turnaround in fortunes is largely the result of the better performing economies slowing down to match the more stagnant performance of major economies like Germany - placed seventh in 2007 - France and Italy in recent years.

This explains Ireland's fall from fifth to 15th place in just a year and the UK's uprooting, as both countries revealed declining fundamental macro-economic data after years of strong growth, according to Invista, and the UK dropped out of the top five altogether to be rated by Invista as the 6th best prospect.

Invista believes countries such as Germany and Italy offer more diversified opportunities which would enable investors to limit and control risk.

In contrast, the smaller and less liquid markets such as Portugal, Hungary and the Czech Republic continue to be risky as price volatility continued to hold them back, according to Invista.

Tim Francis, head of continental European research, said the results also indicates tinvestors were becoming more cautious and reviewing their real estate investments to ensure they did not take unnecessary risk as the markets in general suffered.

"The global economic events of the last 12 months have forced investors to reassess their attitudes towards property risk and pricing," he explained.

"In our opinion, low-beta markets are better positioned to deliver attractive risk-adjusted returns. Despite recent weak economic data, we believe the German property market should consolidate its position as a key investment target for diversified investors," he added.

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