Income returns hold the key for the next two years (Q4 10)

We suspect that euro-zone commercial property yields may fall a little further by the end of this year. However, the bulk of the investment market recovery may well be behind us. Subdued economic growth will prevent a rapid recovery in rental values any time soon and, as such, the prospects for capital value growth are weak. Accordingly, over the coming years, income returns will hold the key to commercial property performance.