The Office and Industrial sectors were the leading performers, with value growth of 1.6% and 1.4% respectively on Q1. Retail grew at a slower rate of 0.5%, though this was still a slight improvement on the previous quarter.
Grouping equivalent yields into quartiles, we see that there was yield compression across all quartiles, particularly in quartile 4. This serves as evidence that the European market is continuing to see yield compression across most asset types. However, the spread from quartile 4 to quartile 1 narrowed for the first time in nine quarters. This is likely to be a sign of the limited availability of top quality assets along with the historically low interest rates.
Over the quarter, the Nordics were the best performing at the All Property level, rising by 2.3%. This was mainly driven by the Office sector (3.2%). Germany followed with growth of 1.8% at the All Property level.
All Property values rose by 1.2% in the UK on the quarter which followed a similar trend to the preceding two quarters of 1.3% in Q1 and 1.1% in Q4.