IPD produces first index of CEE property returns

The Investment Property Databank (IPD) has announced the consultative release of performance data from the new IPD CEE All Property Index. Currently comprising properties in Hungary, Poland and the Czech Republic, the index saw a headline euro-denominated total return for 2006 of 17.5%.

This return is the highest annual performance seen in the historical data, and represents an increase of 1% over the 16.5% return in 2005. IPD's figures also show that the rate of increase in the region's capital values rose by 0.57% basis points between 2005 and in 2006 to 9.1%. The income return also increased, from 7.3% in 2005 to 7.7% in 2006.

Retail commercial property was the best-performing sector, returning 21.3%, followed by industrials at 20.3%. All IPD CEE All Property Index sectors showed an accelerating yield compression and flat rental value growth in 2006. The IPD called on property professionals to contact IPD with any feedback, comments or questions regarding the consultative Index. 'Subject to feedback, IPD intends to produce 2007 figures for the Index early in the second quarter of 2008. Additionally, IPD will work towards incorporating other CEE emerging markets when possible.'

The IPD CEE All Property Index is based on a sample of 183 properties from 16 portfolios covering EUR 5.5 bn at the end of December 2006.

IPD associate director Dr. Nassos Manginas added: 'Investors has allowed us to create this index; but we hope its arrival will encourage local CEE investors to join their international counterparts in contributing their data, allowing even better analysis in the future.'

Click on the link below to go to the IPD site.