PropertyMatch, the secondary trading portal for unlisted real estate funds, has expanded into Europe this year as it seeks to enhance the marketplace for trading secondary units in unlisted real estate funds. PropertyMatch is a joint venture between CB Richard Ellis and GFI Group Inc.
The platform has already facilitated its first two trades in continental Europe for the UBS Euro Core Fund and the Aberdeen Pan-Nordic Fund, highlighting the impact the platform has had with investors. Both trades were in the region of 3 million.
The move will see PropertyMatch capitalizing on the success that it has experienced in bringing increased transparency and liquidity to the UK's secondary market, by supplying a reliable platform where investors can trade secondary units with transparent pricing.
Prior to the launch of PropertyMatch, a common problem associated with the unlisted property sector was that of illiquidity. This was fuelled by the opaque nature of the market, which carried with it issues such as suspension of redemptions and extreme volatility in pricing, thereby severely limiting the appeal of unlisted real estate vehicles as a means of gaining property exposure. In Europe the greatest challenge is in bringing together investors interested in this market, which PropertyMatch seeks to address through offering itself as a reliable and accessible trading platform.
Since inception in 2009, PropertyMatch has facilitated more than £400 million worth of trades in the UK with the technology significantly opening up the market and it has made a critical contribution to building investor confidence in the sector. CBRE and GFI believe the need for this transparency is even greater in Europe where, to date, there has been a limited market for secondary units.
Commenting on the European market, Paul Robinson, Executive Director of Real Estate Finance at CBRE, said: "In one sense the need for PropertyMatch in Europe is more urgent than the UK, where there has always been, to an extent, a secondary market where units in unlisted property vehicles could transact. In Europe, it is becoming very clear through our research and initial trades that there is virtually no connectivity between different unit holders and this has made the possibility of secondary trading virtually non-existent.
"Through PropertyMatch there is the opportunity to bring European market participants together and, through the transparent and reliable trading platform we offer, the ability to open up the European market improving investor confidence and willingness to trade."
Michael Levi, Head of Indirect Property at GFI Group, added: "PropertyMatch intermediated its first European trade in December 2010 and subsequently assisted the trade of a second European fund in the first month of 2011 and these early successes are an indication of the unique ability of the platform to open up a market. We look forward to building on these foundations and increasing European trading volumes this year. Our aim is to roll out the success of PropertyMatch in the UK market to Europe increasing the liquidity and transparency of this sector of the real estate market."