UK - Property performance measurement firm IPD has launched a pan-European index to measure the combined performance of investments in 11 countries.
IPD is consulting the industry about the index which, it says, shows how currency value fluctuations have affected cross-border property investment returns over the past three years.
The index applies consistent market weighting and full currency conversion to the component national returns, providing international investors with a clear profile of a particular investment region. After the consultation period ends, results will be formally published in June 2005.
Founding director Ian Cullen said: “This is an ambitious extension of IPD’s index publication services. We are reporting returns across 11 markets, covering the bulk of the eurozone for the first time, and extending the analysis both to the UK and to the Nordic region.
“We want to make this product something that will be really useful for international investors and would welcome feedback on questions of content and method in the coming months.”
The index is based on the IPD indices for Denmark, Norway, Sweden, France, Germany, Netherlands, Portugal, Spain, Ireland and the UK.For example, it shows that a portfolio of property investment in each of the 11 markets would have seen a return of between 6% and 7% over that period, declining slightly during 2003.
However, a US dollar investor would have received over 20% in each of the last two years, due to the weakening of the dollar relative to European currencies. At the same time, an equivalent euro investor would have suffered a fall in returns as the holding currency has continued to strengthen.
IPD is seeking comments on the methodology, content and presentation of the results from investors, strategists and researchers throughout Europe.
For more information go to www.ipdindex.co.uk
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