At the All Europe level rental growth was positive Q/Q across the core asset classes with positive growth observed for the eleventh consecutive quarter. The pace of growth was marginally weaker. Yields were largely stable. Rising bond yields is placing pressure on pricing in some markets and sectors.
Office
Prime rental growth in the office sector remained positive at 0.9% over the quarter, just below growth in prior quarters this year. On an annual basis growth rose to 4.4%. The strongest growth has been observed in the UK and Nordic markets. Prime yields edged in marginally, although over 90% of markets were stable.
Retail
Rental growth on the high street slowed in Q3 with rents flat in more than 30 of the 40 markets tracked with the strongest growth in the UK, CEE and Southern European markets. Yields were also stable in most markets. No outwards shifts were observed.
Logistics
Following stronger growth in recent quarters, prime logistics rents grew at a slower pace in Q3, up by just 0.5%. Growth was strongest in France, Germany and the UK. Rents remained weak in CEE. Prime yields were flat at 5.23% despite more markets registering inward shifts versus other sectors as logistics was the only sector to outwards shifts.
