European property offers upside despite no yield tailwind in 2025, JPM says
10/12/2024 09:33
** J.P.Morgan expects the European property sector to get no
help from lower yields in 2025, but at the current low
valuations it still sees an average upside of 21% for the stocks
** It favours residential properties over commercial ones in
the euro area and companies with pricing power in the UK
** It says property values are showing signs of recovery,
with industrial and retail sectors leading in capital growth,
but transaction volumes remain a concern especially for offices
** JPM's top picks are Tritax Big Box BBOXT.L and Merlin
Properties MRL.MC , both rated "overweight"
** It is constructive on German residential real estate,
maintaining Vonovia VNAn.DE and LEG LEGn.DE at "overweight"
** It raises Britain's Unite UTG.L to "overweight" from
"neutral" on continued rental growth and strong demand for
student housing
** It cuts Gecina GFCP.PA to "neutral" from "overweight"
due to its exposure to macro-political risks in France, and
Cofinimmo COFB.BR to "underweight" from "neutral" on balance
sheet risks
** It downgrades LondonMetric LMPL.L to "neutral" from
"overweight", Kojamo KOJAMO.HE and Klepierre LOIM.PA to
"underweight" from "neutral" on valuation grounds
(Reporting by Hugo Lhomedet)
((hugo.lhomedet@thomsonreuters.com))