The Association of Real Estate Funds (AREF), representing UK unlisted commercial real estate funds, published its 'Investment Quarterly for Q3 2007' this week, which examines industry trends based on data provided by its members.
The Association of Real Estate Funds (AREF), representing UK unlisted commercial real estate funds, published its 'Investment Quarterly for Q3 2007' this week, which examines industry trends based on data provided by its members.
It reveals that despite nervousness caused by the credit crunch, UK pooled property funds (PPFs) continue to attract new investment. Over £800 mln (EUR 1.15 bn) was raised during the last quarter, with increased inflows from existing PPF investors accounting for a large proportion of the total. AREF note that PPFs, with 6.9% year-on-year total returns, continue to outperform real estate equities and gilts in spite of a general slowdown in the broader commercial property market.
A wide variance is reported in the performance of specialist property funds, with those focusing on Central London offices performing well over the quarter thanks to strong rental growth in this sector. The weighted yield across all 63 funds in the survey stood at 3.22% for the quarter, up slightly from Q2, with the highest distributing fund delivering a yield of 8.4%.
Click on the link below to read the full report on AREF's website.
