European property to outdo UK

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by Elaine Frei

According to Morley European Property, European property will outperform the UK across all sectors following rental growth forecasts. A total return of 6.6% per annum is forecast between 2007 and 2011, a rise on the current income yield of 5% for European property recorded in June.

One of the strongest European economies across all sectors is German and France is appealing due to office space. The Spanish market is also strong according to Morley European Property.

In addition, New Star, one of the country’s leading investment houses, has noted buoyant growth in continental European office markets, such as The Netherlands, Scandinavia, France and Germany thanks to improved economic growth leading to occupier demand and dropping vacancy rates across most markets.

Morley European Property also added that growth in the activity of pan-European investing over the decade has brought increased liquidity and transparency to Europe, a process that has driven largely by stock. 80% of the assets are up due to stock selection.