Segro chief sees no prospect of European REIT

National governments in Europe will continue to block the emergence of a pan-European REIT, according to Ian Coull, CEO of UK-based logistics supplier Segro. 'There will be further harmonisation of REIT regimes, but I do not believe a European REIT will be in place in my working lifetime, or in that of my children or grandchildren. The European Commission has only showed modest interest in a European REIT. I don't see it going beyond that. And tax policy is a thorny issue for national governments.'

Pointing to Segro, which is listed as a REIT in London and also under the comparable SIIQ system in Paris, Coull said a formal European REIT is not essential. 'In 2007, the tax charge for our group came to 1.4%, which is lower than we had expected.' He added that a recent analyst report from Morgan Stanley concluded that European REIT companies have recently outperformed traditional property companies by 12%.

Coull made the comments at a session of the annual conference of the British Council of Offices (BCO) held in Brussels earlier this summer. He said Segro had looked at the possibility of listing as a REIT in other European countries, but had concluded that these options were not interesting. 'But I'm not ruling it out for the future.'

Segro is currently active in nine European countries and is now looking at Romania and Slovakia. Last year the company was one of the first property companies in the UK to list as a REIT on the London Stock Exchange. The UK bourse currently has 19 REITs and that number is set to grow following legislation facilitating the creation of REITs in the self-storage and pub sectors.

Segro has a portfolio of trading and investment properties covering 4.1 million m² of business space that is valued at £6.5bn.