UK Commercial Property Fund Returns Tick Up in Q2
London – July 20, 2017 –MSCI Inc. (NYSE: MSCI), a leading provider of research-based indexes and analytics, announced today the latest results of the AREF/IPD UK Quarterly Property Fund Index.
According to the index, unlisted real estate funds returned 2.2% in the three months to June 2017, compared with 2.1% for the first quarter of 2017.
In comparison, returns for bonds and equities for the 3-month period were -0.7% and 0.8%, respectively (JP Morgan 7-10 year/MSCI), while returns for direct commercial property, as measured by the IPD UK Monthly Property Index, stood at 2.5%.
Funds in the AREF/IPD UK Quarterly Property Fund Index returned 5.4% year-on-year to end-June 2017. Over the same period, the IPD UK Monthly Property Index saw a total return of 5.1%, based on direct property rather than NAV performance.
Malcolm Hunt, Executive Director, MSCI, commented,
“The fund index rose slightly in terms of total return performance compared to the first quarter of 2017, which was itself a marginal improvement on Q4 2016, even if these still represent low levels of return relative to those seen in 2014 and 2015.
“Balanced funds have begun to emerge as the strongest performing group across the last three quarters, although long income funds still show the best 12-month returns. Meanwhile the returns to specialist funds varied significantly in Q2 2017, with those focusing on industrial and alternative real estate sectors doing better than retail and office specialists."
John Cartwright, Chief Executive, AREF, added, “The AREF/IPD UK Quarterly Property Fund Index, sponsored by the Association of Real Estate Funds (AREF) and PropertyMatch, provides an independent view of current market performance and the performance of the funds active within it. It is a key element in the commitment to transparency and the highest standards of governance by AREF member funds. The index is currently based on a sample of 44 funds with a total net asset value of GBP 44.9 billion as at June 2017.”
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