Slight pick-up in February returns – CBRE
CBRE’s Monthly Index for February showed a slight pick-up in total return at the All Property level to 0.4%, after a 0.3% reading in January. The total return in the offices and industrial property sectors was 0.3%, while in retail it was 0.4%. The annual return for the year to February 2013 is 2.4%. There is a strong variation between sectors on an annual basis, with the annual return for offices at 4.7%, for industrial property at 3.7%, and for retail property at just 0.4%.
Capital values slipped 0.2%, for the fourth month in a row. Growth in capital values for Central London offices slowed to +0.1% in February but outside the capital the decline continued with offices elsewhere recording a fall of 0.6% for the month. In the retail sector, capital values dipped 0.1%, with high street shops and shopping centres each down 0.2%.
Rental values edged up 0.1% in the offices sector in February, thanks to 0.3% growth in West End office space and 0.2% growth for retail warehouses, but at the All Property level there was no growth. The largest fall in rental values was in the All Standard Shops category, down 0.2%.
Aleksandra Starczynska, Analyst, CBRE Research, said: “There is an interesting contrast between the impact on capital value of rental values and yields. After a steady decline over 2012, falling by 0.37%, rental values have been stable so far in 2013. In contrast, yield increases continue to impact negatively on capital values.”
