The latest CBRE monthly index shows that all property recorded capital value growth of 0.7% in April, resulting in a total return of 1.2%. So far this year, capital values have grown by 2.8% and recorded a year to date total return of 4.9%.
The office sector recorded a strong performance, as capital values continued to grow, increasing by 0.8% over the month, and total return stood at 1.3% in April.
Notably, for the first time in seven months, offices in Outer London/M25 area outperformed Central London, recording a total return and capital value growth of 1.7% and 1.1% respectively.
That said, Central London offices remained robust, with capital value growth of 0.9% over the month. Midtown in particular was a driver for this performance.
Offices in the Rest of UK recorded uplift in capital values and this is the ninth month of positive growth in this segment.
The latest results also showed that the Industrial sector recorded the highest total return across all main sectors at 1.5% in April and continued to outperform the office sector.
Capital values for industrial property continued to be strong and increased by 1% over the month. This is the twelfth consecutive month where the industrial sector recorded positive capital value growth.
The retail sector continued to improve, recording a total return and capital value growth of 1% and 0.5% respectively. At the segment level, retail warehouses and high street shops recorded stronger results in April than shopping centres.
‘This month Outer London/M25 offices recorded more rapid capital value growth than Central London offices, for the first time in seven months. In fact, this is only the third time offices in Outer London/M25 have seen higher monthly capital value growth than in Central London over the past five years,’ said Aleksandra Starczynska, CBRE Research.