Real Estate Capital UK commentary
UK all-property company relative returns were just positive in January, at 0.4%. However, over the past 12 months, returns remain poor, at -8.4%. The total return for property shares over the year to the end of January was 8.75%, compared to an 18.7% return for the UK equity market.
There was a rally in property shares during the second week of February, with the sector gaining 3%. The improvement was led by British Land, which was up 4%. The second largest REIT achieved a 4.4% rise in net asset value in the three months to 31 December – its third quarter – driven by a 2.3% rise in the portfolio’s value, beating IPD.
Hammerson unveiled its full-year results on 21 February, which included a 12% increase in the portfolio’s value, helped by yield compression in the first half of 2010. Minerva, which has not leased any space for a year in its two large City developments and is the subject of takeover speculation again, was linked with Santander as a possible tenant for The Walbrook.