Returns up 7.7% in last quarter

The property index compiled by agents JLL confirms that that the commercial property market is performing strongly with overall returns up 7.7 per cent in the third quarter.This is the 16th successive quarter of positive growth. Overall returns in the last 12 months were up by 25.9 per cent.

Capital values increased by 6.1 per cent in the quarter and by 18.1 per cent in the year. This was driven by growth across all three sectors with retail up 8.6 per cent, industrial up 5.5 per cent and offices by 4.6 per cent. Overall capital values have risen by 46.2 per cent since the bottom of the market but remain 47.7 per cent lower than the peak in 2007. Overall income increased for the first time in four quarters, rising by 0.8 per cent in the last three months. But income across the portfolio remains 4.7 per cent lower than in Q3 2014.

Research analyst Hannah Dwyer also reports that overall rental values increased by 2.7 per cent in the last three months with industrial up by 3.8 per cent followed by offices (+3.2 per cent) and retail (+1.7 per cent). Overall rental values are now 16.7 higher than at the same point last year.