Commercial property returns shine as bond yields fall and capital gains kick in; income returns stable
May 15, 2013
Returns on New Zealand commercial property rose slightly in the March 2013 quarter and reached 10.6% p.a., according to the latest research done for the NZ Property Council by research house IPD.
From a survey of 566 major properties in 29 property portfolios, the total capital value has now reached NZ$11.7 billion.
Returns in the survey include both “income returns” and “capital returns”.
The “capital returns” are based on revaluations, and 83.4% of properties surveyed were revalued in the March 2013 quarter.
Income returns were pretty stable across the three sectors surveyed – retail, office, and industrial – at about 8.2% pa. (the Capitalisation Rate ).
Capital returns were highest for retail properties, adding 4.2% to the income returns for a total annual result of 12.4% pa
Read the rest here: