Værdiansættelser i IPD Dansk Ejendomsindeks

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Ferdinand Marsh
6 years ago
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2 Agenda Allocation to Real Estate Real estate performance Valuation assumptions Valuations ability for capture volatility Implications for risk and performance measuremnet 2014 Investment Property Databank Ltd. All rights reserved. ipd.com 2

More capital is heading into real estate INREV: The size of the

IPE/Invesco: Over 60% pension funds aim to increase their

Cornell/Hodes & Weill: institutional portfolios 100 bps below the

APREA: Continued potential and strong momentum for increased

3 More capital is heading into real estate INREV: The size of the investor universe is expected to grow by an average of 27%. IPE/Invesco: Over 60% pension funds aim to increase their allocation, though a smaller number are planning a decrease. Cornell/Hodes & Weill: institutional portfolios 100 bps below the average target real estate allocation of 9.8%. APREA: Continued potential and strong momentum for increased levels of real estate in Asian pension funds 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 3

and the fund and asset levels); MSCI (equities and property equities); JP Morgan

4 Real estate is well-positioned Annualised results at 1, 3, 5, and 10 years Notes: All averages as of 2013 YE TR = total return Sources: IPD (real estate and the fund and asset levels); MSCI (equities and property equities); JP Morgan 7-10 years (bonds) 2014 Investment Property Databank Ltd. All rights reserved. ipd.com 4

Important variations in cyclical momentum All property returns by country, % pa in local

Most markets at or close to historic low income return All property indexes Note: Average annualized income return is 10 years for all countries

6 Most markets at or close to historic low income return All property indexes Note: Average annualized income return is 10 years for all countries except Poland, Hungary, Czech Republic (9 years) and Korea (8 years). Sources: IPD, KTI 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 6

7 Value changes represent 30% of the return and 80-90% of the risk 14 years average return and volatility 100% 90% 80% Retail Office Residential All 7% 13% 19% 18% 44% 70% 60% 67% 81% 69% 50% 40% 81% 82% 93% 87% 30% 56% 20% 10% 33% 19% 31% 0% Captial return Income return Capital StDev Income StDev 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 7

8 Valuations input and assumptions Vacancy rate Market rental value Rent passing Rental potential implications for the future? Yield 2014 Investment Property Databank Ltd. All rights reserved. ipd.com 8

12 Rental value growth is levelling of Most segments below long term and inflation years 14 years 3,0 2,5 2,0 1,5 1,0 % 0,5 0,0-0,5-1,0-1,5-2, Investment Property Databank Ltd. All rights reserved. ipd.com 12

13 Positive rent potential since 2009 As of year-end DKK/m % 7% 11% 12% 11% % 3% 1% % -2% -2% 0% Rent Passing Rent potential Source: IPD, weighted averages 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 13

14 Positive rent potential on let last 3 years As of year-end, Office only % Vacancy rate Rent potential on let Source: IPD, weighted averages 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 14

16 Yield consistently optimistic, and very stable Office only 8 7 7,1 7,1 7,1 7,2 6,9 6,6 Valuation Yield Income Return 6 6,1 5,7 5,9 6,0 5,9 5,8 5,8 5,7 5 % ,1 6,7 6,5 6,3 6,3 6,0 5,4 5,4 5,6 5,4 5,0 5,0 5, Investment Property Databank Ltd. All rights reserved. ipd.com 16

17 Yield consistently optimistic, also across segments Year-end ,9 Valuation Yield Income Return 6, ,7 5,7 5,3 5,2 5,5 5,7 6,0 4% 7, ,4 5,0 4,2 5,2 4,2 5,1 5,7 4,4 1 0 Retail Office Industrial Office Copenhagen CBD Office Copenhagen Harbour Office Copenhagen Broer & Fred. Office Copenhagen other Office Copenhagen South & West Office Copenhagen North 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 17

Valuations only capturing part of the volatility Valuation based vs.

19 Ireland UK Norway Sweden France Netherlands Denmark Germany Switzerland Valuations only capturing part of the volatility % Valuation and transaction based volatility, 10 years to end 2013 Transaction-linked index volatility Valuation-based index volatility Source: IPD 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 19

20 MSCI Asset Owner Survey: Shining a Light on Misalignments through the Investment Process Objectives and execution options can create a disjointed investment process Board of Trustees/CIO Real Estate Dept Real Estate Managers Theory Allocation Strategy Implementation $ $ Reality Limited clarity on Real Estate Risks Misaligned policy benchmarks Cannot see impact of property - specific factors Source: IPD 2014 Investment Property Databank Ltd. All rights reserved. ipd.com 20

In short More money to real estate have put pricing under pressure Vacancy high and increasing Rental value is levelling of, little rent potential on let and

21 In short More money to real estate have put pricing under pressure Vacancy high and increasing Rental value is levelling of, little rent potential on let and negative in Cph Harbour Yields artificially high Valuations only capturing part of the volatility 2013 Investment Property Databank Ltd. All rights reserved. ipd.com 21

Real Estate Risk in a Multi Asset Context

Real Estate Risk in a Multi Asset Context Peter Hobbs, Managing Director, IPD Jean Martin Aussant, Executive Director, MSCI 7 th May 2014 2013 Investment Property Databank Ltd. All rights reserved. ipd.com