Values up 5% in Q2

Commercial property values are continuing to recover, rising by 5 per cent in the last three months and by 19.4 per cent in past year. In spite of the strong performance recorded in the JLL Irish Property Index, values still remain 60.6 per cent lower than they were at the height of the property boom in 2007

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The overall returns also underline the current stability in the market which has now reported positive results for the 11th consecutive quarter. In the three months up to the end of June, the returns reached 7.2 per cent while year-on-year the figure rose by 30.1 per cent. The last time annual returns exceeded 30 per cent was in Q3 2006.

All three sectors of the market have now recorded enhanced capital values over the past four consecutive quarters with offices leading the way with a rise of 7.1 per cent over the last quarter and 24.6 per cent in the last 12 months. Retail was 3.1 per cent higher in the second quarter while industrial moved up by 1.4 per cent.

The index, prepared by JLL's Hannah Dwyer, also recorded an overall increase in income of 0.3 per cent in the last three months and 2.4 per cent over the full year.

With prime office rents now edging towards €430 per sq m (€45 per sq ft), it is hardly surprising that rental values rose by 16.9 per cent in the last three months compared to only 2.1 per cent in the previous quarter.

Overall rental values increased by 9 per cent in the last three months compared to 1.2 per cent in the previous quarter. The JLL study relates to 29 properties with an overall value of almost €320 million.