As real estate valuations increase across the globe due to a rise in rental growth, Kempen’s Egbert Nijmeijer says its important to keep an eye on mispriced stocks.
Speaking to Citywire Selector, A-rated Nijmeijer, who runs the Kempen Global Property fund highlighted two stocks that have performed well in the last month.
‘Our holding in BUWOG-Gemeinnietzige Schung in Germany has done very well. It profits from continued growth in the German residential sector and it has a great development plan on top of that, that’s a name we see further value in.’
In the month of August, the company was one of the fund’s top performers, contributing 0.11% to the fund, along with property developer Prologis, which contributed 0.13%.
‘Prologis (3.53%) in the US industrial space is also doing well. In real estate, the amount of time we will hold a stock varies, as if we spot a mispricing and it effectuates in a week, then we will sell it in a week. Or if it takes two years or so we are willing to wait it out.
‘For us, it’s just a matter of how quickly the mispricing effectuates. We don’t take sectoral country weights, it’s all about the individual names that can do well within a given month.’
Over the one year to the end of September 2017, the Kempen Global Property fund returned 1.22% in US dollar terms. This compares with a 1.52% rise by its Citywire-assigned benchmark, the FTSE EPRA/NAREIT Developed TR USD, over the same time period.