A surge in property yields helped commercial property valuations improve for the first time in two years in the final quarter of 2022. Jumps in alternative asset yields late last year following the ‘mini-Budget’ meant the shift was modest, but those yields are now falling back and we expect a bigger improvement in valuations over the course of 2023 as property yields see further increases. As the most overvalued sector heading into the downturn, it was not a surprise that industrial saw the largest yield rise in Q4. But it remains the most overvalued sector and is therefore set to for further increases in yields this year.
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