Global office property values are continuing to improve, with new CBRE research highlighting a 0.9% rise during Q1 2013.
CBRE Global Chief Economist Ray Torto said the rise accentuated the strong risk-adjusted returns offered by commercial real estate.
“The availability of such returns, in contrast to lower-yielding investment alternatives, continues to create intense competition for prime assets,” Dr Torto said.
“Limited supply and keen demand for prime space in the best locations have supported global office rent levels even in a global environment still constrained by chronic economic headwinds. As economic and property fundamentals continue to recover steadily the outlook for rents is for stability or, over time, moderate growth.”
“Office property’s appreciation during the quarter accentuates the strong risk-adjusted returns offered by commercial real estate. The availability of such returns, in contrast to lower-yielding investment alternatives, continues to create intense competition for prime assets.”
In Asia Pacific, the Office Capital Value Index grew by 0.7% in the quarter and is the only regional index to have surpassed its pre-recession peak, expanding by 4.5% since Q2 2008.
Key markets in Greater China and New Zealand continued to record rises in capital values during Q1 2013. Relative to a year ago, capital vales are up 2.3% in Asia Pacific.