Overseas investors accounted for more than 25% of all commercial property investment transactions of over £1 million ($1.39 million) in 2000 and DTZ anticipates they will retain this market share, with around £5 billion ($7 billion) of purchases this year with US investors dominating activity.

UK pensions funds committed £3.7 billion ($5.1 billion) to commercial property in 2000, and DTZ's survey shows property fund managers expect property to outperform other asset classes again in 2001 with returns expected of around 9.6% against 7.4% from equities and 6% from government bonds.

Peter O'Gorman of DTZ's fund management department said: 'Our research shows that those pension funds which decided to maintain or increase their weighting in property over recent years have been rewarded with outperformance in 2000 and, according to our survey of fund managers, an expectation of outperformance by the sector this year.'The continued availability of debt finance is also likely to underpin the property market this year. At the end of 2000, debt outstanding to property companies was estimated to be around £81 billion ($112.6 billion).