Many European real estate listed property companies appear to be more reactive than strategic in their major capital budget decisions when acquiring investment properties and undertaking development projects, the annual conference of the European Public Real Estate Association (EPRA) has heard.

These companies are not making full use of the sophisticated analytical tools available to them, said Colin Lizieri, author of the survey and Grosvenor professor of real estate finance at Cambridge University in the UK.

'We certainly formed the impression of an industry reacting to market conditions, rather than using strategic planning, and one that is not making the best use of the analytical tools available to help it with crucial capital allocation decisions.'

Lizieri stressed these were preliminary findings and further analyses of the survey's implications was required.

The EPRA/Cambridge Capital Structure Survey was conducted in July and August 2010 among European listed property companies. A total of 44 firms with a market capitalisation of EUR 72 bn responded to the survey, which represents around 88% of the market capitalisation of the EPRA European Index. Real estate investment trusts (REITS) and non-REITS were equally represented in the survey.