Two separate reviews of the property market show "spectacular" 12-month returns of between 35 per cent and 36 per cent - although with indications that this year is seeing a slowing off in returns.

The Jones Lang LaSalle Irish Property Index for the second quarter of this year reports overall returns for the quarter of 6.7 per cent, and an annual return in the year to June of 35.2 per cent.

The SCS/IPD June Quarter Property Market Returns overview reports that while returns have faded a little through the last two quarters, the market is still showing a 12-month return of 36.8 per cent.

The Jones Lang LaSalle Index, based on an equivalent institutional portfolio of 34 properties worth £178 million, with 59 per cent in offices, 30 per cent in retail and 11 per cent in industrial, records continuing strong returns.

The international agency reports "The pace of growth is almost identical to the first quarter of the year, and although 1999 is set to have lower overall returns than 1998, there does not appear to be any marked fall-off in performance."

It says capital values across all three sectors increased by 5.5 per cent in the second quarter and by 29 per cent in the year to June.

It comments: "Again, this sustains the level of growth in the first quarter of 1999. Office yields continue to be pared down as investors benefit from the low-cost of funding and the strong growth in returns. The result is an increase in office capital values of 6.6 per cent in the second quarter and 32.6 per cent in the year to June 1999."

Jones Lang reports that the industrial sector is keenly sought by investors and capital values increased by 4.7 per cent in the second quarter.

Retail yields have stabilised at a low level and values rose by 3.3 per cent in the second quarter. Rental levels rose by 3.4 per cent and 16.1 per cent over the year.

The strongest rental growth is in offices, with an increase of 4.5 per cent and 21.3 per cent over the year. The report says "The shortage of available built stock, coupled with strong demand, puts the cards firmly in the landlord's hands. The balance may alter somewhat as more development comes on stream during 2000."

SCS/IPD reports that all-property returns fell to 6.5 per cent over the three months to June - its lowest level since March 1998 - "but the market is still showing spectacular 12-month returns of 36.8 per cent."

"The slight dip in returns is due to a slowing in the fall in yields. The all-property equivalent yield fell by 0.13 points in the last quarter taking the year to date decline to 0.27 per cent."

It says: "Against other assets, property performed well ahead of equities and bonds in the second quarter of the year. "The modest lull in property performance in the last quarter stems from the office market, where returns fell back to 7.2 per cent over the three months. Retail and industrial returns were, by contrast, both up on the previous quarters. Industrial yields tied with offices, posting a return of 7.2 per cent."