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News Release

Dublin

Q3 2012 Index Overall Returns positive for last 12 months

The Jones Lang LaSalle Irish Property Index Overall Returns continued to show positive results for the fourth consecutive quarter


The Jones Lang LaSalle Irish Property Index Overall Returns continued to show positive results for the fourth consecutive quarter, despite continued falls in Capital Values and Income. Rental values are still drifting down, and as properties in the portfolio move towards the end of leases on much higher rents, they will continue to feel this impact.

Capital Values (-2.4%), Income (-2.4%) and Rental Values (-0.5%) all produced negative results, although decreases were slightly lower than last quarter when they fell by -2.3%, -2.5% and -1.4% respectively.
 

 

Hannah Dwyer, Research Analyst at Jones Lang LaSalle said that ‘despite the falls in Capital Values and Income, the Overall Income yield of 9.6% for the whole Index portfolio means that investors still get positive returns on investments’. ‘The high yield is therefore sustaining any falls in values and is contributing to a positive Overall Index result of +0.1% in the quarter and +4.5% in the year’ she added.

 

Capital Values for all three commercial property sectors (offices, retail and industrial) continued to decline in Q3 2012. The greatest fall in Capital Values continues to be for Retail (-4.0%), followed by Offices (-1.2%) and Industrial (-1.0%). Decreases in Retail and Industrial Capital Values are greater than last quarter when they decreased by -2.9% and -0.5% respectively, highlighting the continued difficulties these sectors are facing.
 
Rental Values decreased for Offices (-1.0%), and Retail (-0.1%) but at a much slower pace than last quarter when they fell by 1.4% and 1.6% respectively. Industrial remained consistent, with no change in results for the last two quarters.
 

 

Hannah also added that ‘although there are still decreases across most indicators, the pace of decline does appear to be slowing with all of this quarter’s year-on-year changes significantly lower than the results a year ago. For example, the Capital Index and Income results in 2011 were -13.7% and -7.9% compared to -5.2% and -4.3% in the year’.