RCA's new European head sees local markets opening up as transparency grows

Local market players often underestimate the importance of transparency for attracting cross-border capital, says Simon Mallinson, executive managing director at Real Capital Analytics (RCA).

RCA's new head of European business will be responsible for building on client relationships and developing the research team. In his new role, he is also mulling new transaction indices for the UK and Europe along the lines of the company's US model.

Mallinson joins RCA from Invesco Real Estate, where he was senior director leading the European research team. Prior to that he spent many years with IPD, another international property data firm.

PropertyEU: What does your new role at RCA involve?
Mallinson: I will be based in London with responsibility for spearheading RCA’s analysis and reporting to clients, representing the business at conferences and other speaking engagements, building on client relationships and developing the European research team. My priority is the service to existing clients with some business development roles as well.

PropertyEU: What insights/experience do you take from your stint with an active fund manager?
Mallinson: I left Invesco due to the exciting opportunity with Real Capital Analytics, a company I have known for many years. Invesco was a great experience and has had a great few years investing about €2 bn over that period. I have brought with me a good knowledge of how RCA data can be used to inform the transaction process, but also what the industry lacks in terms of capital markets information. Without going into detail while I work with RCA on plans to fill these gaps, I believe we already have much of the information needed within existing products. I will be working with colleagues on how best to get the awareness of this market intelligence to our clients.

PropertyEU: What is the biggest challenge facing the European real estate industry in terms of transparency?
Mallinson: It’s an interesting question. I would say that when investors are focused on their domestic markets they don’t feel that there is a huge problem with transparency - they have the contacts and the local market knowledge. It is when they go outside their domestic borders that they are suddenly faced with a transparency issue. This is even true of a UK investor looking at a transparent market such as the US or Australia. The challenge for RCA is offering a global service that helps make the transaction data more transparent while working with a network of local data partners each with different and important needs that must be respected.

PropertyEU: Can you comment on the products RCA is developing to promote further transparency?
Mallinson: It is a little too early for me to comment on new products that I might want to see developed, but I certainly see an important role for RCA’s new suite of transaction indices, the first of which were released for the US earlier. Where data allows these will be developed globally with the UK the next likely market. These indices are different to valuation- based indices and are based on paired transaction values, tracking the changes in pricing. They allow the pickup of important market turning points, helping investors make better decisions.

PropertyEU: Where does Europe stand on transparency versus the US/Australia a) in 2013 b) in 5-10 years time?
Mallinson: In most major Western markets, with perhaps the exception of Germany, transparency is pretty similar although the US does still take the lead. Transparency is weakest in the smaller emerging markets but here they are beginning to realise that in order to attract cross-border investors they need to increase transparency. In the next 5-10 years I believe we will see local markets open up as cross-border capital providers demand easier flow of data, and governments begin to legislate to make data available.