Liffe, the derivatives business of Euronext, on Thursday announced plans to launch two futures contracts on indices that track the performance of European real estate companies. The new derivatives will be launched on 1 October.

Liffe, the derivatives business of Euronext, on Thursday announced plans to launch two futures contracts on indices that track the performance of European real estate companies. The new derivatives will be launched on 1 October.

'We are extremely excited about this development,' said Nick van Ommen, the outgoing ceo of the European Public Real Estate Association (EPRA) at a press conference in Athens where the annual Epra conference is currently being held. 'This initiative represents a major step in the evolution of the listed property market in Europe. It puts real estate on an equal footing with the other core equity sectors and will contribute to the further development of a deep and liquid market in property stocks for investors.'

The two new futures contracts are based on the FTSE EPRA/NAREIT Europe Index and the FTSE EPRA/NAREIT Euro Zone Index, both of which are seen as the benchmarks in Europe for investments in listed real estate companies. The FTSE EPRA/NAREIT Index covers approximately 100 listed real estate companies based in 15 European countries with the largest weighting being the UK (45%). The FTSE EPRA/NAREIT Euro Zone Index covers approximately 50 real estate companies based in nine Euro Zone countries, with the largest weighting being France (40%).

The two real estate futures contracts are the first of their kind in Europe and compliment Liffe's existing range of derivatives on national and pan-European equity indices. Interest in real estate linked financial instruments has grown significantly in Europe in recent years and a market had developed in over-the-counter traded derivatives.

During the press conference, Van Ommen also introduced his successor Philip Charls who will take over the Epra helm at the end of this month.

See also our interview with Nick van Ommen and his successor Philip Charls in the September issue of PropertyEU.