Discounts in the market price of a company (or fund) holding an asset to the book value of the underlying asset have been extensively studied in equity markets. Explanations such as accumulated capitalgain liabilities, management costs and institutional characteristics have been suggested as reasons for the observed discounts. However there has been little research on this phenomenon in real estate markets, despite a belief that such discounts are pervasive. Using data collected by Merrill Lynch and EPRA it is possible to investigate how discounts to net asset values vary cross-sectionally by using the approach of Shin and Stulz (2000). To do this we measure growth opportunities by identifying the total volatility and the systematic (beta) risk of a firm. We then use cross section regression techniques to study the relationship between the firmÌs discount to NAV and the risk measures across European markets.