Equity funds focused on property sector rebound in 2012, but managers raise concern over lack of visibility. Despite data showing a strong performance bounce in the first half of 2012 compared to the past two years, global property equity fund managers remain ‘uncertain’ over future prospects due to a faltering US recovery and questions over future growth in China.
Global property equity funds saw a sharp rebound in the first half of 2012, up 12.6 per cent in the first six months of the year compared to a 7.8 per cent decline in 2011 and a fall of 10.5 per cent in 2010, S&P Capital IQ fund research has revealed………………………………………..Full Article: Source

Property consultancy firm Jones Lang LaSalle (JLL) India has set up a new entity JLL Segregated Funds Group to raise funds to invest in the Indian real estate market, and its first fund worth Rs 300 crore will be launched soon in the domestic market.
Capital market regulator Securities & Exchange Board of India ( Sebi) has approved the proposed fund, which will be a close-ended one with a six-year tenure………………………………………..Full Article: Source

European property funds recorded a total return of 4.9% over the 12 months to June, according to research by the Investment Property Databank.
The total return performance for the first six months of the year was 1.8% whilst over 12 months to June 2012 the return was 4.9%. On a balanced basis the annual return was 9.3% whilst the specialist fund corresponding returns were 2.9%………………………………………..Full Article: Source

Government of Singapore Investment Corp. is investing in a 30-year-old San Francisco office tower that’s valued at about $900 million, according to one person with direct knowledge of the transaction.
GIC, as the Singapore sovereign wealth fund is known, is part of a group that’s taking control of 101 California Street in San Francisco’s financial district, said the person, who asked not to be identified because the information isn’t public. The fund declined to comment in an e-mailed statement………………………………………..Full Article: Source

In Italy, real estate funds have attracted €1.4bn during the first semester of 2012, a 4.2% increase compared to the previous semester, according to data published by Italian asset management association Assogestioni.
Research on 185 funds in the country found that real estate assets reached €26bn at the end of June. About 90% assets were allocated to property and only 10% to property rights………………………………………..Full Article: Source

The market share of debt funds compared to all private equity real estate funds launched in Europe in terms of target equity rose from 15% in 2011 to 20% in the first three quarters of 2012, according to an analysis by Swisslake Capital.
However, the allocation for Europe remains far from adequate at just $3.7 bn (EUR 2.3 bn) so far this year. A year ago, the figure was $3.8 bn. In 2011, a total of $12.1 bn of equity was targeted globally………………………………………..Full Article: Source

Union Investment GmbH, Germany’s second-largest property fund manager, started a 500 million-euro ($655 million) fund to buy offices, shops and hotels.
The UniInstitutional German Real Estate, aimed at institutional investors, will acquire properties valued at about 20 million euros to 50 million euros, the company said……………………………………….Full Article: Source

Returns in the unlisted sector rose to 0.4% in the third quarter of 2012, as underlying falls in valuation in the direct property market eased slightly, according to the AREF/IPD UK Pooled Property Fund Index. Balanced funds continued to outperform their specialist counterparts, but the gap in performance narrowed to just 10 basis points, 0.4 to 0.3%.
Over the last 12 months the unlisted sector has returned 2.5%, against the 3.5% delivered by the direct commercial property market. Equities and REITs have had a volatile but strong twelve months, and the effects of last summer’s crisis of confidence have now dropped out of their twelve month returns………………………………………..Full Article: Source

The move by liquidating open-ended property funds in Germany to return cash to investors has roughly doubled the sector’s average distribution yield in around five months. The yield from the community of portfolios hovered around 3.5% early in the second quarter.
But according to the according to the September report of commercial real estate performance monitor IPD Investment Property Databank GmbH, it has jumped to nearly 7%………………………………………..Full Article: Source

A Blackstone Group LP (BX) fund and Emeritus Corp. (ESC) agreed to sell a group of senior housing properties to HCP Inc. (HCP) for $1.73 billion, the largest deal for a health-care real estate investment trust this year.
Blackstone Real Estate Partners VI bought the 133-property portfolio out of bankruptcy in 2010, HCP said in a statement today. The Long Beach, California-based company, the largest health-care REIT by market value, said the purchase will add 8 cents a share to its annual funds from operations………………………………………..Full Article: Source

Grupo BTG Pactual plans to sell about 2 billion reais ($983 million) in shares of its FII BTG Pactual Corporate Office Fund.
The Brazilian real estate fund will start selling 6.89 million shares in a secondary offering, according to a prospectus. BTG will issue other 6.15 million shares in a primary offering if all the secondary placement is concluded in two months………………………………………..Full Article: Source

At first glance, trends in German real estate don’t add up. As German property funds suffer a series of liquidations, house prices continue to drive relentlessly upwards causing mutterings of a property bubble in Europe’s core economy.
Yet the curse of German real estate funds refers to retrospective challenges, according to Ulrich Steinmetz, managing director at RREEF, Deutsche Bank’s dedicated property group, and manager of its Grundbesitz Europa and Grundbesitz Global funds………………………………………..Full Article: Source

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One of the world’s largest sovereign wealth funds has made its first foray into the German property market with a €784m deal for two buildings, as it continues to scout opportunities in major European cities.
Norges Bank Investment Management, which manages $615bn on behalf of the Norwegian government pension fund, has agreed to acquire two buildings in Berlin and Frankfurt from Royal Bank of Scotland, the fund said on Wednesday………………………………………..Full Article: Source

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Blackstone Group LP closed on its most recent global real estate fund, Blackstone Real Estate Partners VII, raising $13.3 billion, the largest opportunistic real estate fund ever, the company said Wednesday.
The private equity firm raised the funding over the past 13 months from more than 250 investors globally. U.S. public pension plans, were the largest category of investors, Blackstone said………………………………………..Full Article: Source

Uncertainty in the eurozone has continued to plague real estate funds in 2012, with weak performance continuing in most European markets, according to latest analysis from IPD property fund indexes.
It update found that the direction of real estate markets, and whether or not returns have now hit the bottom - still looks “very unclear”………………………………………..Full Article: Source

London is attracting increasing volumes of overseas funds into residential and commercial property, leading to a rise in annual revenues for upmarket property agent Knight Frank, despite the domestic economy shrinking.
The company, one of the biggest partnerships in the UK, said revenues grew 8pc to £334m in the year to March 31. This means Knight Frank’s 61 partners will share a profit of £65.2m, down from £72.7m last year because the property agent spent capital on opening new offices in South Africa, Dubai, Australia and India………………………………………..Full Article: Source

Norway’s $650 billion sovereign wealth fund is closing in on its first U.S. real estate investment as the market struggles with stagnant prices.
The fund will invest in the U.S. “by the end of next year at the latest,” Trond Grande, deputy chief executive officer at Norges Bank Investment Management, said in a Sept. 27 interview in Molde, Norway. “The U.S. is the largest real estate market so if you want to have a global portfolio you must have exposure to the U.S.”……………………………………….Full Article: Source

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IPD real estate fund indices for Europe are starting to show a pronounced north-south divide, with vehicles investing in the Nordic region turning in the strongest returns through the last four six-month periods, and those focused on Italy the weakest, with their underlying values falling significantly during the last year.
The Nordic funds generated total returns of 4.7% in the first six months of this year, while Italy turned in a negative performance of -2.3%. Pan-European funds were also in the red with -1%. ……………………………………….Full Article: Source

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The private equity arm of Housing Development Finance Corporation, HDFC Property Fund, plans to raise a $500-million real estate off shore fund by the end of 2012.
The company is in talks with sovereign funds, including Government of Singapore Investment Corporation (GIC) and Qatar Investment Authority, to raise the capital. It is also talking to Japanese and US investors, a person having direct knowledge of the fund raising said, requesting anonymity………………………………………..Full Article: Source

The IPD Italy Biannual Property Fund Index saw returns come in at a negative 2.3% in the six months to June 2012, which is the second consecutive negative performance, bringing the annual figure to a negative 4.8%.
In total, the Index reported a negative difference of 350 basis points compared to the same period last year. The Index sample has remained unchanged as far as the number of funds is concerned at 39 closed-ended domestic funds. However, the total NAV (net asset value) of just below EUR 8 bn indicates a fall of 4.8% against the previous semester………………………………………..Full Article: Source

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The Italy biannual property fund Index published by global information provider IPD, recorded a total return of -2.3% in the first six months of 2012, with the annual figure at -4.8%.
In its second consecutive negative performance, the Index reported a negative difference of 350 bps compared to the same period last year. The Index sample remained unchanged at 39 closed-ended domestic funds, accounting for a total NAV of just below €8bn, and assets under management at €13.4bn………………………………………..Full Article: Source

Non-listed real estate funds raised $5.1 bn (EUR 3.9 bn) globally in August, with Asia seeing an increasing share of the action, according to data published by Indirex. Indirex, an on-line community for indirect real estate, said 32 new fund raisings were announced for August, with 25 relating to new equity commitments. Over 40% of the cash raised is destined for Asian markets.
Australia’s Colonial First State Global Asset Management Property announced it had raised more than AU$547 mln (EUR 437 mln) from six domestic and institutional investors for its CFSGAM Property Enhanced Retail Fund (CERF). The original target was A$500 mln………………………………………..Full Article: Source

German open-ended real estate funds returned 0.1% in August while the sub index for funds predominantly invested in Germany returned 0.2% for the month and 2.6% for the last 12 months, according to the latest monthly report published by the Investment Property Databank.
The European-focused funds achieved a return of 0.1% in August and 0.2% over 12 months, while the globally invested funds bettered that with 0.2% this month and 0.3% over the last year………………………………………..Full Article: Source

Morgan Stanley’s real estate fund is in talks to buy a Moscow shopping center for between $1.1 billion and $1.2 billion from Capital Partners, three industry sources told Reuters on Thursday.
“The buyer - Morgan Stanley’s Real Estate fund - is conducting due diligence, the property is not being offered to other potential buyers anymore,” said one of the sources, who had also considered buying the Metropolis mall………………………………………..Full Article: Source

U.S. funds have had the lowest real estate returns in the global pensions industry because they rely on costly external managers and made risky bets before the financial crisis, according to a study by Maastricht University.
Property investments generated an average net annual return of 5.7 percent for U.S. pension funds from 1990 through 2009, according to research by the Netherlands-based university. That compares with 7.2 percent returns for Canadian funds and a typical return of more than 7 percent for other funds………………………………………..Full Article: Source

ASK Property Investment Advisors, the property fund arm of ASK Group, plans to launch a $200 million (Rs 1,100 crore) international real estate fund next month. The fund plans to do initial closure in March 2013 and final closure 12 months after that, said Sunil Rohokale, CEO and managing director, ASK Investment Holdings.
In launching such a fund, ASK joins half a dozen managers such as HDFC, IDFC, IL&FS, Indiareit, Kotak and Tata Realty & Infrastucture, which are planning to launch foreign realty funds………………………………………..Full Article: Source

Aetos Capital LLC, which has acquired $10 billion of assets in Japan and China, plans to raise $1 billion to invest in the two countries as it bets on distressed opportunities in Japan and housing demand in China.
New York-based Aetos plans to buy distressed debt and assets including office, residential and retail properties in Japan from banks that are seeking to recover their loan value, Managing Director Scott Kelley said in an interview in Tokyo. The fund will also develop apartments in second-tier cities in China, he said………………………………………..Full Article: Source

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Poland’s richest man Jan Kulczyk and New York real estate mogul Larry Silverstein have launched a fund that plans to invest up to 1.5 billion euros ($1.9 billion) in Central and Eastern European commercial property.
While the region’s real estate markets were hit hard by the second wave of the financial crisis and transaction volumes slumped by about 40 percent in the first half of 2012, Poland and the Czech Republic have remained relatively resilient………………………………………..Full Article: Source

The eurozone crisis pushed second-quarter returns on pan-European real estate funds into the red for the first time since early 2010, according to the latest research from IPD.
Total returns at the NAV level amounted to -1.1% in Q2, the first negative return to be recorded after several quarters of marginal growth……………………………………..Full Article: Source

German funds are snapping up Dutch commercial properties, accounting for 47% of office investments in the first half of 2012, as the country’s markets experience a favourable outlook.
According to Savills latest research report on the Netherlands commercial real estate markets the first half of 2012 saw a total office investment volume of €1.1 billion, a rise of 36% compared with the same period of 2011. The firm said that this increase is largely due to Chalet Group buying the Philips High Tech Campus in Eindhoven for €425 million……………………………………..Full Article: Source

Aberdeen Asset Management has launched a German residential property fund in order to capitalise on increased investor demand and the growing strength of the rental market.
The ‘Städte und Wohnen’ fund, which will be managed by Daniel Dreyer, has been launched with initial seed capital of €115 million. Aberdeen said it had launched the fund in order to capitalise on the increased demand for indirect investment in German residential property from institutional investors……………………………………..Full Article: Source

Berlin’s proposal to prohibit launching new open-ended property Spezialfonds may not be stopping real estate managers from launching new funds, but it is forcing them to choose Luxembourg for the task.
In July, Berlin proposed the launching of new open-ended real estate fund and real estate Spezialfonds, as part of its implementing European-wide plans to regulate alternative products within the Alternative Investment Fund Managers Directive (AIFMD)…………………………………….Full Article: Source

European regulation poses threat to affordability of property funds to UK investors, trade bodies warn. A major piece of European regulation could lead to spiraling costs for ‘bricks and mortar’ property funds, according to trade bodies.
Both the IMA, the fund management trade body, and the Association of Real Estate Funds (Aref) have warned that the Alternative Investment Fund Managers directive (AIFMD), which is expected to come into force next summer, will raise costs for mainstream direct property funds……………………………………….Full Article: Source

Despite ever-growing demand for new housing in the UK, private rental properties have never really captured the imaginations of pension funds and other institutional investors, which have focused their real estate investments on commercial properties.
But the government is now attempting to attract more institutional money to the residential sector in order to boost the country’s supply of homes. Last month, Sir Adrian Montague’s report, “Review of the Barriers to Institutional Investment in Private Rented Homes”, suggested the government should clearly identify opportunities in the market, ease affordable housing requirements that can lower returns and alter planning rules to facilitate more development……………………………………….Full Article: Source

Total returns of European non-listed property funds dropped into negative in the second quarter, down 0.3% and reversing the positive 0.5% performance in 1Q12, says the funds association INREV. Most weakness came from fund exposure to southern Europe.
Multi-country fund performance slid to -1.1% from 0.4% in 1Q12, with capital growth turning even more negative, at -1%, and continental Europe back in negative territory at -0.4% after 0.5%. For single-country funds, Italy was the worst performer in 2Q12, with total returns of -0.4%, even though this was an uplift from -0.9% in first quarter………………………………………..Full Article: Source

Appetite from German funds for prime Dutch office properties remains high, accounting for 47% of office investments (€516 mln) in the first half of 2012, according to Savills latest research report on the Netherlands commercial real estate markets.
The international real estate advisor records a total office investment volume of €1.1 billion in H1 2012, a rise of 36% compared with H1 2011. The firm notes that this increase is largely due to Chalet Group buying the Philips High Tech Campus in Eindhoven for €425 million………………………………………..Full Article: Source

Following a series of liquidations and increased regulation, German property funds can now expect a revival driven by new demand from institutional investors, said Ulrich Steinmetz, managing director at Deutsche Bank’s property group RREEF.
The most recent casualty in a series of property fund liquidations is the HANSAimmobilia fund which announced its liquidation last week citing increased regulatory risks, investor outflows and a worsening image of the asset class. The fund had seen its assets half over four years to €268 million………………………………………..Full Article: Source

The last time foreign funds jumped into the Japanese property market around 2006 they snapped up assets from office blocks to hotels, fuelled by highly leveraged bank loans. Then came the global financial crisis and many of them got burnt.
Their appetite is starting to return. In Tokyo’s posh Meguro neighborhood, the 14-storey Meguro Place Tower that went up in 2009 was never intended to be a landmark. But a fund partly owned by a unit of Aviva Plc, Britain’s second-largest insurer, saw something eye-catching in its concrete-and-glass — a buy………………………………………..Full Article: Source

The Netherlands’ largest pension fund ABP had a real estate investment portfolio totalling EUR 28.8 bn worldwide at end-2011, a rise of 12% compared to the previous year. ABP’s real estate portfolio is managed by asset manager APG. However, in Europe the figure slipped 4% to EUR 19.2 bn.
Other major Dutch pension funds also boosted their property holdings in 2011. The pension fund for the building sector BPF posted a 6% increase while the pension funds for the metal workers industry PME and PMT booked rises of 15% and 4% respectively………………………………………..Full Article: Source

Property funds for institutional investors achieved a total return of 0.4% in the first half of 2012, with funds focusing on Germany achieving a higher return of 0.7% and pan-European funds delivering 0.2%, according to IPD’s new SFIX Quarterly Indicator.
Funds focused on retail properties turned in the best performance at 0.8% compared to 0.2% for office-focused funds………………………………………..Full Article: Source

Real estate funds, floated as private equity vehicles, offer an alternative to buying property. But what factors must you consider before deciding whether you should buy a property or invest in a fund? And how conducive is the current real estate market for private equity investment?
An investor who was willing to experiment with this product with any player has now taken a conscious decision to invest only in funds with a track record of good execution and record of giving money back to investors………………………………………..Full Article: Source

Funds for investment in the UAE commercial property market are beginning to rise with capital values expectations turning positive for the coming quarter - first time since 2008, says the Royal Institution of Chartered Surveyors (Rics).
As per the second quarter 2012 report by the UK-based institution, rents will continue to decline at a slower pace since 2008 due to new supply coming on to the office market, but transaction numbers are set to increase in the third quarter………………………………………..Full Article: Source

Leon Black’s Apollo Global Management LLC (APO), the private-equity firm that is seeking to rebuild its real estate arm, is raising $750 million for a pair of funds that will focus on commercial properties in Asia.
The AGRE Asia Pacific Real Estate Fund LP filed a private- placement notice last month with the U.S. Securities and Exchange Commission to seek as much as $600 million of capital. The New York-based management company is also teaming up with Bank of East Asia Ltd. to raise $150 million for a related fund that will focus on China, according to a separate July filing………………………………………..Full Article: Source

Funds invested in the local listed property sector were the star performers over the quarter to the end of June, returning on average 8.92 percent for the quarter. This fund sub-category was also the best- or second-best-performing sector over longer periods up to five years.
Domestic real estate general funds had the second-highest returns over the year to the end of June, with an average return of 22.67 percent, according to ProfileData. Over three years, this sub-category was the second-best-performing sub-category, with an annual average return of 21.41 percent………………………………………..Full Article: Source

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Red Fort Capital Advisors Pvt., a real estate private equity fund that manages more than $1 billion of Indian assets, plans to raise $500 million next year to invest in homes and offices in Asia’s third-largest economy.
The company has invested about half of its $500 million Red Fort India Real Estate Fund II raised in January this year, Managing Director Subhash Bedi said……………………………………….Full Article: Source

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The housing market may finally be coming back, with home prices rising again and mortgage rates at record lows. But there’s far greater strength in commercial real estate. Check out the recent investment returns of stock mutual funds that specialize in companies owning income-producing property, from office buildings to hotels.
Real estate funds have posted an average annualized return of 33% over the last three years, according to Morningstar. That’s the top performance among the fund categories it tracks. Year-to-date, the funds are up nearly 17%. That’s about double the average return for diversified stock funds………………………………………..Full Article: Source

In June German open-ended real estate funds returned -0.1%, repeating the weak performance of the previous month. The sub-index OFIX Germany performed significantly better than sub-indices for the European and global funds.
It returned 0.2% for the month of June and 0.5% for the 2nd Quarter of 2012, whereas the returns for the European and global funds were negative in both periods. Only when one takes a ten-year perspective does the OFIX Europe surpass OFIX Germany, with an annualised return of 3.1% compared to 2.6%………………………………………..Full Article: Source

UK balanced property funds outperformed specialist funds for the third consecutive quarter in the first three months of 2012, according to the Association of Real Estate Funds’ (AREF) Investment Quarterly (IQ) for the period. This pattern follows eight consecutive quarters of specialist funds outperforming balanced funds.
The UK PPFI (all pooled property funds index) delivered a quarterly return of 0.7% in Q1, down from 1.2% in the fourth quarter of 2011. This marks the fifth consecutive reduction in the quarterly return rate since the peak of 2.7% in Q4 2010……………………………………….Full Article: Source

Sovereign wealth funds are changing the dynamics of the French real estate investment market, attendees at the PropertyEU Investment Briefing in London heard last week.
This type of investor typically seeks prime real estate assets, Jonathan Baines, head of central London investment at Colliers International, pointed out. ‘Sovereign wealth funds invest for the long term, normally for 10 to 15 or even 20 years. This will have an effect on liquidity.’……………………………………….Full Article: Source

The Canada Pension Plan Investment Board is investing $1.04-billion in two office towers in Australia, the largest investment it’s ever made in a single real estate project.
The deal is part of a series of bets that Canadian institutional investors are placing on office towers amid the global financial crisis. Their aim is to secure towers in major cities, such as London, Toronto and Sydney, at a time when sluggish economic growth has taken a toll on the market………………………………………..Full Article: Source