Speaking on the back of the latest market figures, property market experts have concluded that fast-rising commercial property values in the UK have caused European property investors to alter their sights to continental Europe as they look for stronger returns there.

The chief investment officer of CB Richard Ellis Investors. Ian Gleeson commenting on the phenomenon to the London Business School’s Conference, said: “We are seeing much more interesting opportunities on the continent now. Pricing in the UK is less compelling than it was a year ago, although it does still offer value. Commercial property prices in the UK have climbed 13% since July last year during which time the property market rebounded from a two-year downturn. The tenant market, however, is still weak as average rental values continue to fall.

The managing director with Aviva Investors, Ben Stirling, commented that property returns on continental Europe generally returns at an aggregate 7.5% in the period from 2010 to 2015. It’s forecast for the UK for the same period, by comparison, is around 8.5%. Stirling further commented: “On the face of it, the UK does appear to be an attractive prospect purely from a returns perspective, although a lot of the value in the UK is being delivered in the course of this year, and the anticipated returns profile is less attractive looking forward.”

The two firms stated that they certainly recognise value in both the German and French commercial property markets, with Aviva also interested in western European regions like the Benelux and Nordic areas. areas.Stirling further commented on his worries regarding debt problems in such fringe markets as Ireland and Spain. By contrast, Land Securities chief executive, Francis Salway, is convinced that the London office property market and sector prospects appear to be strong due to the fact that developers have not overbuilt in the way they did in the early period of the millennium and good mortgage offerings exist in order to help stimulate the commercial sector still, particularly for individuals with good finances and credit history looking to open up their own location via a self-cert mortgage.

Salway further commented that London, as a city, is very much global, and many businesses are serving Singapore, New York and Hong Kong rather than Newcastle. “London firms continue to plan their expansion in line with global growth,” he added. According also to a new report, the French commercial investment market doubled its turnover in the first quarter of this year, and totalled almost 1.8 billion Euros as compared to 0.9 million for the same period in 2009.