The ongoing recovery in the commercial property market shows no signs of slowing down.

The JLL Irish Property Index published today indicates that overall returns in the three months up to the end of June rose by 5.2 per cent, bringing the figures for the past twelve months up to +32.8 per cent.

With positive growth on record for the past 15 consecutive quarters, the index is now only -7.8 per below the levels recorded at the peak of the market in Q4 2007.

Capital values rose by 3.6 per cent in the last quarter and by +24.2 per cent over a 12-month period. These enhanced values were driven by a growth across all three sectors with industrials doing best at +7.2 per cent followed by offices (+5.4 per cent) and retail (0.2 per cent).

Decline

The index recorded a decline in income for the third successive quarter, falling by -0.4 per cent in Q2. The decline in rental income arose because of a vacancy and a new letting which involved a rent free period.

However, overall rental values increased in the last three months by +2.9 per cent with industrials showing the greatest increase (+9.2 per cent), followed by offices at +3.5 per cent. The retail sector did not show any change.

Hannah Dwyer, head of research, said the index was performing steadily with growth in overall returns driven by increases in capital values. "It is interesting to note the impact of income in protecting returns from property. While the capital value index is still -51 per cent below peak, the overall return index, including income return, is now just -7.8 per cent below peak."