Midtown offices outperformed the City and West End last year, according to figures released by IPD.
The Farebrother IPD Midtown Investment Report revealed that rental growth and income return in the Midtown office market was the strongest among the London office markets.
Rents grew 7.1% during 2010, outperforming both City and West End offices, at 6.6% and 5.2% respectively.
The result was also well above the all UK office average of 1.5%.
Income return, at 6.1%, was also 40 basis points higher than the nearest office markets.
Alastair Hilton, head of investment at Farebrother, said: “The case for investment in Midtown becomes even more compelling, with all the key ingredients in place for strong asset performance.
“Whilst there are some clear short to medium term gains, in the long term the strategic position of the Midtown market can no longer be ignored.”
Greg Mansell, research manager at IPD, said: “The Midtown office market achieved total returns of 22.2% year-on-year in 2010.
“Repricing, as measured by IPD’s yield impact series, was the main source of performance at 11.3% year-on-year, outlining the positive influence of sustained investor appetite for Midtown assets.”
nathan.cross@estatesgazette.com
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