UK listed sector sees Brexit bounceback

The total value of the UK listed commercial property market topped out at $91.7bn (£70.5bn) at the end of Q1 2019, according to the latest figures from EPRA. The UK is the second-biggest developed European market behind Germany, which topped out at $112.9bn. The US is the largest global market with a whopping $1.2tn of listed real estate. EPRA director of research and indexes Ali Zaidia said the UK listed market had seen a recovery in value compared with its European peers, despite the ongoing challenges in UK real estate. “Before Q1 2019, the UK market had been on a medium-term decline after peaking at $100bn in 2017 and bottoming out at $82bn in December 2018 following the Brexit vote,” said Zaidia. “This recovery could continue throughout 2019, given the delay in the UK withdrawal agreement from the European Union, which is now not expected before Q4 2019, and the robust performance of the alternative sectors and a recovery in GBP.” Zaidia said the German listed market had been propelled to first position in terms of value due to the rise of the listed residential sector and the increasing preference among the German populace to rent rather than buy their homes. The total value of listed commercial real estate in developed Europe is $8.2tn, which is just over 6% of the total value of European commercial real estate. In North America, the listed sector accounts of $1.3tn of the $9.6tn of commercial real estate. EPRA’s report also reveals some 228 REITs within the listed real estate sector in the EU, with a combined market capitalisation of $217bn. Together, EU REITs make up almost half of the total EU listed real estate sector, valued at $449bn. Looking beyond the developed markets, EPRA’s figures show a total estimated value of the commercial real estate sector of $8.1tn, some $1.1bn of which is listed. For the first time, EPRA has included Saudi Arabia in its emerging markets coverage due to improvements that have opened up the domestic market to international investors. It values the listed real estate market in Saudi Arabia at $20.7bn, making it the third-biggest listed market in the Middle East and Africa, behind the United Arab Emirates with $27.8bn and South Africa with a listed sector valued at $24.4bn. China is has the biggest listed real estate sector within EPRA’s emerging markets table, totalling $711.4bn. The figure also makes it the second-biggest listed real estate market in the world, “just” $488m behind the US. Globally commercial real estate is valued at $31.1tn, with the listed sector making up some 12% ($3.7tn) of that. To send feedback, e-mail samantha.mcclary@egi.co.uk or tweet @samanthamcclary or @estatesgazette