UK property values continued their slow decline in April, falling 0.3% during the month, according to CBRE.
It was a slower rate of decline than in March when capital values fell 0.4%, leading to a marginal increase in total returns to 0.2% across all property.
The agent said the improved return was due to the continued strength of central London offices, which remain robust with values increasing 0.1% – driven largely by the West End and Midtown sub-sectors.
Rental growth in central London was up 0.7%, helping to offset softening yields in some other sub-sectors.
CBRE reported a slight improvement in the retail sector, with flat total returns – an improvement on -0.1% in March. This was largely due to a better result reported by retail warehousing, which saw a positive total return of 0.2% in April.
A slight improvement in the retail sector in April masks difficulties in the tertiary shopping centre sector, where yields slipped out by 100bp to 10%, according to Jones Lang LaSalle’s monthly prime yield index. However, with muted activity resulting in static yields in all other sectors, the agent’s prime average weighted yield remained stable at 5.58%.
