Alpha Finance “sees” room for further growth of Real Estate Investment Companies, taking into account the positive prospects of the real estate market, the possible reduction of interest rates from the second half of 2024 and the possible improvement of market liquidity.
In a report, it presented the main characteristics of the six largest Real Estate Investment Companies (Prodea, Trastor, Premia, BriQ, Trade Estates and Noval Property), which include the structure of their portfolios, their key financial figures, strategy, management, their internal governance and shareholding structure.
As Alpha Finance noted, the portfolios of the Greek Real Estate Investment Companies are quite diversified, while commercial properties such as office buildings – mixed-use properties (47%), retail stores – banks (29%) and logistics (15%) have a dominant position with the value of the total portfolios of listed companies reaching 3.9 billion based on the latest published data (first half of 2023).
According to the report, European Real Estate Investment Companies are trading close to their book value (NAV) on average, based on the historical data of the last 20 years, however, at the current time, their valuation is much lower, around a 30% discount to their book value, among the worst of the last two decades.
The main reasons for the large discount they are trading today are the high interest rates and the concern about the course of the real estate market, as in several markets stagnation or even a decrease in values is recorded.
The Greek Real Estate Investment Companies also trade at a discount compared to the NAV for the last 5 years and a particularly increased discount at the present time (20%-30%). And this despite the dynamic recovery of the Greek real estate market after a prolonged period of crisis.
In conclusion, Alpha Finance estimated that the recovery of Greek real estate will continue thanks to the positive macroeconomic trends, the increase in foreign direct investment and tourism and the possible increase in financing from the banking sector.
