The Sensitivity of European Publically-Listed Real Estate to Interest Rates

This report examines the exposure of European public real estate markets to interest rates, a topic of evident importance given the events of the last decade. While events in the credit markets played a pivotal role in the 2007-09 financial crisis, the broader relevance of monetary policy and interest rates was clearly seen both in the preceding boom and in the resulting financial and economic crisis. This report contributes to the existing literature in a number of respects. Firstly, it considers the sensitivity at both a market/sector and firm level. Secondly, in both cases we expand upon the methodological analysis commonly adopted. Finally, with the exception of the UK, very little research has been conducted on this topic in the context of European markets.