Opportunistic investors gain ground

Opportunistic investors are increasing their share of total real estate investment volume in Europe, according to research from JP Morgan Asset Management.

In 2012, opportunistic transactions accounted for 12% of all deal activity in Europe, double the average of just 6% recorded during the 2007-11 period.  Over the past 12 months, just under $15 bn (€11.3 bn) was transacted in Europe by opportunistic investors compared with $9 bn in 2011 and under $5 bn in 2010.

The new data follows hard on the heels of a recent report published by the asset manager which highlights how real estate market conditions, the macro economy, capital scarcity and apprehensive investors have created a new profile and opportunity set for European property investment.

According to Joe Valente, head of research and strategy at JP Morgan Asset Management, a new era in opportunistic property investment is opening up in Europe. ‘This time, returns will not be driven by financial engineering, but by the ability of the manager to add value and de-risk assets,’ he said.

The latest data about opportunistic transactions provides further evidence that opportunistic investment product is becoming more readily available on the market, he added. ‘The bid-ask spread is gradually narrowing, making it possible to successfully implement an opportunistic strategy.’