Zell: ‘little opportunity’ in US, even less in Western Europe

Speaking at a real estate conference in London this week, legendary investor Sam Zell said he is mainly focussing on emerging markets for investment.

Sam Zell says he sees no significant opportunities in the established real estate markets, preferring instead to focus on areas such as Mexico and parts of Latin America.

Zell, who sold US office Reit Equity Office Properties to Blackstone for $38 billion last year, was addressing the REIT Day Investor Forum in London this week hosted by the National Association of Rea Estate Investment Trusts (NAREIT).

In a one hour question and answer session, he said: “I do not see at this point any significant opportunities in the developed world. As an equity investor I see little opportunity in the US and I see less in Western Europe.”

Explaining how he expected European property values to fall, Zell added he was currently looking at property in Latin America and China. “There is a growing middle-class scenario across the world, particularly in emerging markets. I’ve tried to focus investment on arenas that play to that.” He said some areas he is looking at include low-income housing in Mexico, middle income housing in Brazil and middle-to-low income housing in China.

He said that in 2008 Equity International, Zell’s private equity operations, will build, sell, finance and close more than 60,000 units in Mexico alone.