CB Hillier Parker calculates that the average UK property yield has stabilised at 7.2%, after falling steadily over the first three quarters of 2002. And it warned that investors are likely to pursue more selective investment strategies in 2003.
On the occupational side, the CB Hillier Parker rent index has fallen for the second consecutive quarter as weak tenant demand continues to drag down rents in the Central London and South East office markets. And the glut of second hand space overhanging the market is likely to depress office rents in the coming year. But the picture is brighter in the retail sector, where a buoyant consumer economy should continue rental growth, albeit at a moderate pace, said the report.
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