Yields in Germany's key real estate segments will rise sooner than previously forecast in the wake of the credit crunch, according to Frank Billand, board member of Union Investment, one of Germany's largest open-ended funds. 'With borrowing costs rising and higher equity ratios being demanded, higher yields will be required, particularly for properties entailing greater risk. The risk element has not been priced in a deal for the past 12 months. That has now changed and that's a positive market development. '
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