A survey of 150 property investors in Germany France and the UK by DIFA has found that the British focus more on returns than the Germans and French. Some 46% of British investors interviewed assessed investment decisions primarily on a yield perspective. Only 22% of Germans did.
On the issue of security risk, though, just 29% of real estate investors in the UK regarded risk as the top priority, compared with 44% of German investors.
German investors appeared less concerned with achieving maximum short-term returns, this being a key objective for just 22%.The main aim was rather to achieve solid long-term performance (78%), making a safe investment (69%), avoiding risk and performance impairment (67%), and ensuring competitiveness with comparable investments (56%).
The focus on risk is much less apparent among UK and French investors. Achieving the best possible short-term returns is more important in the UK (43%) and France (41%) than in Germany.
DIFA’s Ingo Hartlief said: “This indicates a fundamental difference in attitude and in the way the market works. Because their customers tend to be risk-averse, German institutional property investors have a highly cautious approach to risk.”
In the UK (70%) and France (75%) investors appeared more willing to accept risk as intrinsic to property. Only 60% in Germany took this stance. Mr Hartlief said: “We need to examine whether real estate is positioned correctly as an investment product in Germany and consider whether internal regulations are holding back the creation of a culture that accepts greater risk as the price for higher returns.”
British investors were relatively comfortable balancing risk and return but Germans aim for a long-term view and investment continuity. Some 88% regard these as important or very important, compared with 75% in the UK and 53% in France.
All investors surveyed agreed on the need for reliable market data: about 70% said that direct access to relevant information is an important aspect of property investment management. The perceived availability of data varies. While 40% of French and 50% of British property investors believed it was easy to obtain, only 21% in Germany did.
Mr Hartlief said: “The relative lack of transparency in Germany deters foreign investors. The transparency initiative launched by open-ended real estate funds represents a first step towards redressing this issue. Further progress could be made by establishing an independent, impartial institution that takes over responsibility for collecting, preparing and publishing standardised data and indices.”
The assessment of the investment climate for office space over the next year is much more pessimistic in Germany than in the UK or France. The French are the most optimistic about the retail sector followed by the British. French investors are the most optimistic on general prospects: 31% thought the situation in their country would improve over the next year. Only 21% in Germany and 14% in the UK took this view.

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