Sam Zell: Sees No Real Estate Opportunities In US, Europe

LONDON -(Dow Jones)- U.S. real estate entrepreneur

Sam Zell said Tuesday he sees no significant opportunities in the European or U.S. property markets.Zell, who is chairman of Equity Group Investments, said “as an equity investor I see little opportunity in the U.S. and even less in Europe,” advising investors instead to look to emerging markets for growth.Speaking at the real estate investment trust forum run by NAREIT, the U.S. real estate investment trust, or REIT, association, in London, Zell said he expects European property values to fall and he is identifying opportunities in Mexico, Chile, Brazil and China instead.

“There is a growing middle-class scenario across the world, especially in emerging markets,” which is leading to pent-up demand for housing in those markets, he said.

Zell said the rented apartment sector will remain strong, despite the ongoing credit crunch, because it benefits from the slowdown in the housing market. If tenants start buying their own houses, it increases tenant turnover and also lowers the economic status of tenants, he said.

In the current market where individuals are finding it difficult to get sufficient credit to buy their own homes, the rented sector remains strong.

Zell sold REIT Equity Office Properties to Blackstone Group for $39 billion in February last year and has since entered the media industry with the $8.2 billion acquisition of newspaper and TV company Tribune Co. (TRB). He is also chairman of five listed companies including Equity Residential (EQR), the largest U.S. REIT which specializes in apartments.