Non-listed European funds see returns fall in Q1

Returns for non-listed European vehicles included in the Global Real Estate Fund Index (GREFI) fell from 2.50% at end-2014 to 1.82% in Q1 2015.

The GREFI draws together data from the Asian and European Associations for Investors in Non-listed Real Estate Vehicles (ANREV and INREV) and the National Council of Real Estate Investment Fiduciaries (NCREIF).

Overall performance remained positive, but dipped slightly compared to the end of last year, with the GREFI returning 2.51% overall in Q1 compared to 2.92% in the previous quarter, INREV said in a note.

Commenting on the data, Henri Vuong, INREV Director of Research and Market Information said: "The robust performance we saw over the course of 2014 has to an extent carried over into the first quarter of this year thanks to improving returns in the US. The slight fall in returns in Europe is of some concern given the current uncertainty in the eurozone, but despite this the broader trends suggest that performance is likely to remain positive over the coming months."

Overall returns were highest in the US, followed by Asia Pacific and then Europe, according to the latest data. The US and Asia Pacific have swapped places since Q4 2014 as a result of performance increasing in the former (from 3.12% to 3.23%) and falling in the latter (from 3.40% to 2.34%).

However, one-year rolling annualised returns improved in all three regions compared to the last quarter. The US recorded the largest increase, from 11.81% to 12.74%.

With a quarterly total return of 2.63%, global open-ended funds outperformed the overall GREFI. For the second quarter in a row, non-core funds (2.67%) performed better than core (2.47%).

The GREFI Q1 2015 update covers the performance of 379 funds with a combined NAV of $352bn (compared to 345 funds at the end of 2014). This difference is due to the increase in the number of funds delivering data in Europe and Asia.