The global financial crisis thrashed the Australian real estate investment trust (REIT) sector last year when the REIT index dropped 55.3 per cent, a Mercer survey has found.
The data showed listed property was the worst performing sector of the Australian equity market in 2008, Mercer principal David Carruthers told InvestorDaily.
"Listed assets are obviously exposed to the share market and sentiment and all those types of things so they can, at various points in time, get out of line," he said.
"Going back a couple of years listed property was much more highly valued than the unlisted sector, and now they're a lot less highly valued compared to the unlisted sector."
However, he said in the longer-term investors should not expect a considerable difference between the performance of listed and unlisted property.
The number of stocks in the listed REIT sector is now very small and dominated by Westfield, according to Carruthers.
"So people should really be thinking whether they should be investing just in the Australian REITs or whether they should make the step up to global REITs," he said.
"Not that their performance over the last year or two has been much better, but it just gives you a lot more assets to invest in and a lot more variety."
