Currently over a third of the German Open-End Funds (by AuM) are closed for redemptions or are in liquidation.
The total property market value of the analysed funds is around EUR91bn and the market value of the funds closed for redemptions (excluding funds in liquidation) is EUR33bn, while the property market value of the funds in liquidation is EUR4bn.
We believe that property valuations are abode market values in Germany and property for disposal will need to be devalued by at least 10-15% to sell.
We have envisaged three scenarios, with escalating levels of sales and liquidations.
The largest exposure of GOEF assets is in the European office sector - on a country basis, the impact will be strongest in Germany, France and The Netherlands.
The impact on the amount of stock for sale on the market will be limited in 2011, but will accelerate from 2012-2014 as GOEFs become net sellers in Europe.
Source : AXA Real Estate