No pressure for Europe property mergers: Bressler

By Peter Starck

LONDON (Reuters) - Property firms in Europe are under no pressure to merge thanks to strong real estate markets but this could change as conditions change, a senior industry executive said on Tuesday.

"Every major property company in Europe is doing well, there is no substantial pressure to do a deal," said Leon Bressler, a partner at boutique investment bank Perella Weinberg Partners.

"But there could be changes. Today we don't have a property slump but we have a slide in the value of property stocks ... this could create some changes," he said at the Reuters Real Estate Summit in London.

The global property share index .GPR250ALLE has fallen 12 percent since late February. Measured by the FTSE NAREIT/EPRA index , European property shares are down 15 percent.

"If things get worse, tricky, in one way or the other, this could lead to consolidation," said Bressler, former head of France's biggest property firm Unibail Holding (UNBP.PA: Quote, Profile, Research, Stock Buzz) and the driving force behind preparations for its merger with Rodamco Europe RDMB.AS this year.

The upswing in west European commercial property markets in recent years, which has resulted in value creation through yield compression, was near or already past its peak, he said.

"This source of value creation is more or less behind us," he said, adding reversal was natural at the end of the cycle but this does not mean values will collapse.

Despite their recent rise, market interest rates -- a key factor for the profitability of real estate companies -- were moderate, Bressler said.  Continued...