All property total returns has eased to 2.3% over the three months to March, which is the lowest quarterly total return recorded since Q2 2003.

Growth properties have outperformed value properties, recording a total of 2.7% compared to 1.2%. This two tier market is apparent across all sectors with retail value properties particularly coming under pressure. Also there is a greater proportion of prime as opposed to secondary assets in the market, and these prime assets are supporting overall returns.

Jeremy Handley of Jones Lang LaSalle told PIN: “The main cause of the difference in returns between growth and value is there is more capital in growth than value proportionally. Investors are more confident in buying growth than value as there are higher yields and more secondary factors in value. This implies more risk to the investor who will want more compensation for taking on the risk.”

Julian Stocks, head of capital markets England at Jones Lang LaSalle, added: “This is born out by our current sales, where prime opportunities remain keenly sought after.”