Portuguese property funds are not benefitting much from renewed investor interest in Southern Europe, as evidenced by their annual returns which are hovering around the historic low point.
Portuguese property funds are not benefitting much from renewed investor interest in Southern Europe, as evidenced by their annual returns which are hovering around the historic low point.
The APFIPP/IPD Portugal Quarterly Property Fund Index shows that Portuguese property investment funds delivered an annual total return of -3.2% at fund level for the year ending June 2014.
Portuguese property funds underperformed bonds at 28.3% (JP Morgan Government Bond Index 7-10 yr) and equities at 14.7% (MSCI Portugal), over the 12 months to end-June 2014.
The total return, which is very close to the -3.3% historical low recorded recently, was 1.1% lower than the 12-month return as at June 2013.
For the year to end-June 2014, a decline in performance was seen across all fund categories. Both closed-end funds (FIIAH) and open-ended funds delivered a 12-month total return of -2.5% to June 2014, reflecting declines in performance of 91 and 108 basis points respectively, compared with a year earlier.
Closed-end funds (excluding FIIAH) recorded the lowest annual total return, at -5.3%, and suffered the strongest decline in performance over the last 12 months (143 basis points).
The APFIPP/IPD Portugal Property Fund Index, sponsored by PwC, comprises 12 open-ended and 27 closed-end funds (including 7 FIIAHs) with a combined gross asset value of €6.9 bn as at end-June 2014.
