While the news of vaccines provides a fillip to our economic outlook, it does not have a major bearing on our occupier market forecasts. After all, we expect that structural change, rather than cyclical growth, will be the major driver of occupier activity in the next five years. This will be to the detriment of the office and retail sectors, but a boon for industrial property. Apartments will see a limited impact from structural change in the short term. The upshot of this is that retail and office returns will average only 4% p.a. in the 2021-23 period, before strengthening thereafter, whereas industrial total returns should average roughly double that, at 8.5%-9% p.a. in the next three years. Apartments should return around 7% p.a.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services