According to CB Richard Ellis (CBRE), rents in all commercial property sectors in Europe are affected by weak economic conditions across the Continent in the second quarter of this year, particularly the office sector.

In a survey of 49 office locations, some 26 saw prime rents fall, 23 were unchanged but none experiencing an increase. The steepest fall was in Kiev, down -25%, followed by Moscow which saw rents decline by -16%. Several other Central and Eastern European (CEE) markets also saw downward pressure.

Among the major western European office markets, notable quarterly falls occurred in London, Madrid, Dublin and Oslo, while rents remained relatively stable in Germany and the Netherlands.

Richard Holberton, director, EMEA research at CBRE, reported: ‘The downturn in real estate values across Europe has so far been predominantly driven by increases in yields. However, we have now clearly entered a period in which rents are the driving force behind the property value corrections.

‘This quarter’s European yield data is particularly interesting. It is too early to signal the end of the period of rising yields, but equally the scale and incidence of yield increases are now a lot patchier than they have been for awhile. While investment turnover remains relatively low, there appears to be growing interest in several areas of the market, supported by the re-pricing that has already taken place,’ he added.