EPRA Monthly Brief

Welcome to this year’s first edition of our monthly brief, with which I would like to extend to you all my best very wishes for an optimistic and healthy 2022.

We started the year with our now traditional EPRA Insight events, where our panellists discussed the outlook for the real estate markets in Paris, London, Germany and the Benelux region. ESG, inflation, interest rates, and the future of the retail, office and logistics sectors where high on the agenda. You can still rewatch all four events on demand, here.

Earlier this month, we launched the EPRA Developers Research Benchmark, a non-commercial benchmark designed to allow its constituents to assess themselves against each other. You can read more about the requirements for inclusion here. The high-level computation has been integrated in the EPRA annual market review, which you can access in the ‘additional reading’ section of this brief. The underlying data can be requested from the EPRA team on-demand by contacting research@epra.com.

As always, I would like to welcome our newest members: Aurora Eiendom, Equinox and K2A.

Dominique Moerenhout, EPRA CEO

At the end of December the OECD confirmed that the uniqueness of REITs as an investment vehicle excludes them from the scope and provisions of its new global corporate tax rules, meant to affect all Multinational Enterprises (MNEs) as from 2023. The so-called Global Anti-Base Erosion (GloBE) rules under Pillar Two introduce a global minimum corporate tax rate set at 15% for all companies, irrelevant of sector or industry. The minimum tax will apply to MNEs with revenue above EUR 750 million and is estimated to generate over EUR 130 billion in additional global tax revenues annually. The European Commission is now in the process of introducing a related legislation to bring the agreement into legal force at the EU level. EPRA is engaging with the relevant institutions to ensure that the specificities of our sector are fully understood and that the rules agreed at the global level remain intact. Read more HERE.

Under its Academic Programme, EPRA commissioned two research papers in 2021. The first one, dedicated to the influence of listed real estate on the performance and risk of a mix-asset portfolio, introduces the concept of ‘uncertainty’ to determine the optimal allocation to listed real estate. You can read the executive summary and download the full report by the University of Cambridge HERE. The second research explored the hot topic of working from home and investors’ expectations about its effects for the commercial real estate sector in the largest European economies. To read the highlights and download the full research by the University College London, click HERE.

EPRA introduced a new corporate access event to its roster. The inaugural EPRA Growth Corporate Access Event took place on December 8 and aims to promote companies that are primed for growth in the coming years. Although these companies may be less-brokered than their larger counterparts, they should be not be overlooked. We were delighted to offer 8 European listed real estate company members the opportunity to present themselves in an afternoon of virtual one-on-one and group meetings. Due to the event’s success and positive feedback, we look forward to undertaking a similar event this year, and offering more companies an opportunity to present their business. We would like to take this opportunity to thank the companies that participated in the event: Arima, Ascencio, Ediston Property, Home REIT, Peach Property, Phoenix Spree Deutschland, Picton, Selectirente. If you are interested in your company participating in a future event, please do not hesitate to contact IO@epra.com.

Additional reading

Selection for your agenda

REITs’ specificity acknowledged in OECD’s landmark tax reform

Real estate in a mix-asset portfolio & the effects of WFH

Highlighting the rising stars