Our Europe Commercial Property Chart Pack has been updated with the latest data and our analysis.
The property correction slowed slightly at the end of last year, but we think the fall in capital values has a bit further to go. Investor pessimism will push yields higher in the near term and rental growth will slow further given the weak economic backdrop. That said, capital value declines should be much smaller than those seen to date. Offices are set to fare worst given the poor rental outlook. Meanwhile, stronger rental growth will support industrial values and better valuations are expected to entice some investors back to the retail sector.
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