Listed companies raise EUR 8.4b in QI

Public real estate companies raised $12 bn (EUR 8.4 bn) in the first quarter of 2011, according to LaSalle Investment Management. Global real estate stocks and the broad market posted solid returns in the first quarter of 2011 despite considerable volatility in March. The UBS Global Investors Index of real estate stocks was up 4.5% while the MSCI World Equity Index of broad-market stocks gained 3.7%.

North America, Europe and Australia all showed positive regional results. Public real estate company earnings growth remains on track for 2011 with a high-single-digit increase expected this year and strong growth continuing in 2012. The growth this year is expected to be led by higher earnings in North America and the UK.

Real estate companies in Continental Europe were up 3.2% in the period and were a little ahead of the broad market index. The investment market has improved and values are rising although the leasing market has remained flat-to-weak. According to LaSalle, prime assets are seeing the strongest demand with initial yields compressing slightly and occupancies remaining stable. While Eurozone economic concerns stepped up somewhat on economic concerns in Portugal, Germany and Northern European countries have shown above average or better than expected growth. Unemployment is stable and inflation pressures low.

Asian real estate stocks declined, notably in Japan after a very strong fourth quarter, and somewhat less in Hong Kong and Singapore.

While the disasters in Japan are a major concern in both humanitarian and economic terms, LaSalle believes that any impact on global economic growth rates will be minimal. Growth in Japan will slow in through the end of 2011, but there should be an uptick in economic activity in 2012, as the government and corporations spend money on reconstruction activities.