More property firm IPOs are expected in 2014

2nd Oct 2013 14:50

The number of initial public offerings (IPOs) by European property firms will hit a post-financial crisis high this year, The Wall Street Journal (WSJ) wrote on Wednesday. It comes as European companies begin to emulate their American rivals by turning to capital markets for funding. A stock market listing is considered a good asset for these purposes. Nevertheless, there are also rising concerns about a possible property bubble in some markets, particularly in the UK, the WSJ said. Among the companies which have floated this year are Foxtons Group, Countrywide, LEG Immobilien AG and Deutsche Annington Immobilien AG. The newspaper also cites analysts as having explained that a general shift by real-estate companies away from development toward the acquisition of assets such as residential portfolios will encourage more property companies to list in 2014. Nevertheless, there are also those who are cautious, such as Mike Prew, head of real estate at Jefferies International. Prew is worried about risks such as another flare-up of the Eurozone crisis and the possibility of governments around the world ending their quantitative easing policies."We are uniquely cautious in a stampede of bulls," the analyst is cited as having stated. European property companies account for about 14% of the €645bn global listed real-estate market, according to data from Global Property Research, versus 58% for the US and Canada. In 1993, European firms made up more than 30% of the market, while North America accounted for barely 10%.AB