Commercial property capital values 'reach record levels'

New figures have suggested that commercial property capital values reached a record high during the fourth quarter of last year.

The study by Jones Lang LaSalle found that capital values reached 8.4 per cent over the period, which helped to boost all-property total returns to ten per cent across the three months.

In addition, the strong investment performance during the quarter meant that all-property returns for 2009 hit six per cent.

Mike Penlington, director of Jones Lang LaSalle's valuation advisory team, said: "As we move into 2010 we expect investor demand to remain strong. We expect this year to produce the highest total returns over the next four years.

"Investors will, however, keep a close eye on pricing particularly over the next two quarters to ensure that the market does not get ahead of itself."

The release of the study has come after research by CB Richard Ellis revealed commercial property prime yields fell over the fourth quarter of 2009.