Where Do European Property Values Go From Here?

Property Values Fall in Every Recession Peak-to-Trough REIT Total Return During European Recessions

In the periods leading up to a recession, REITs have tended to experience variable but significant losses in value. REITs are priced daily, therefore adjust to uncertainty relatively quickly. Private real estate valuations that are backward-looking in nature, tend to show moderate losses in value (if any at all). This is largely a result of the smoothing effect of private valuations. Public valuations meanwhile can often be overreactive, typically resulting in meaningful declines. Nonetheless, property values almost always fall to some extent during a recession.

-25.2%

-27.5%

-33.3%

-49.6%

-71.0%

Early 1990s

GFC (2008)

European Sovereign Debt Crisis (2011)

COVID-19 (2020)

Russia-Ukraine Conflict (2022)

Source: Bloomberg (FTSE EPRA NAREIT Developed Europe Index TR), Cushman & Wakefield Research

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