The IPD Nordic Quarterly Property Fund Index shows that property funds in the region returned 0.7% in the second quarter of 2014, a rise on the 0.5% return in the previous quarter.
Annualised return to the end of the second quarter was 1.5%, IPD reported.
However, property funds underperformed property equities, which returned 5.4% through the second quarter. Property funds also underperformed the broader Nordic equities index, which returned 5.1% over the same period, as measured in euro returns.
Property funds have struggled over the past five years, IPD said, as they have been “heavily outperformed by both broad equities and property equities.”
Håvard Bjorå, head of Nordic Client Consultants, IPD, said, “It is encouraging to see fund performance continue to improve. Even though the aftermath of the credit crunch has been difficult for property funds, we have only recorded three quarters with negative returns since 2009, while 15 quarters have seen positive returns.”