Italian property funds are showing a slow but steady recovery, according to the IPD biannual property fund index for the market.
Italian property funds are showing a slow but steady recovery, according to the IPD biannual property fund index for the market.
The latest index recorded a total return of -0.4% in the six months to June 2013.
The second half of 2012 delivered a lower return of -0.9%, adding up to a 12-month return of -2.3% over the full year. Although the index has still been in negative territory for the past four semesters, IPD said that a consistent improvement in returns has been shown since the deepest dip in H1 2012 of -1.4%.
In the wider context, Italian real estate closed-end funds outperformed equities, which returned a negative -7.2% over the six months to June 2013 (MSCI Italy). All other asset classes recorded strong positive total returns, with real estate equities posting a 9.9% total return (Data Stream Italy Real Estate) and bonds delivering 2.2% (JP Morgan GB Italy) in the first half of the year.
Luigi Pischedda, senior associate and head of IPD Italy, said: 'Italian closed-end real estate funds are beginning to show some signs of recovery, in a wider market context of broadly positive signals. Despite a further semester of NAV declines, the index displays slower rates while confirming previous period distributions.'