REC global commentary
Europe headed the league of global property securities markets in February, returning 4.2%. The UK was the leading market, with a 6.6% return, but France and Germany both registered 4%-plus.
On a 12-month basis, the US leads, returning 37.7% and also outperforming the broader equities market over 12 months. The rebound by these developed markets follows upgraded earnings forecasts and the search for inflation-hedging investments.
But while UK listed real estate securities do provide some protection against inflation over time, they do not, strictly speaking, hedge it by keeping pace with it (see chart above). A better hedge would be found in markets or companies with retail price index (or inflation)-linked leases.