The Austrian All Property total return for 2006 was 6.5%, says IPD. This return is the highest posted since the beginning of the index and constitutes an increase of 90 basis points on 2005. Property under-performed the equity market in 2006, which returned 27.1%, but outperformed the bond market, which returned 3.7%.
For the third consecutive year, the retail sector was the strongest sector with total returns of 8.4%, an improvement of 100 basis points on 2005. Other commercial properties remained in second place with returns of 6.4% in 2006. The residential market saw returns increase by 130 basis points with a return of 6.3% in 2006, the highest the sector has seen over the last three years.
Although office sector total returns increased by 90 basis points on 2005, achieving total returns of 5.2% in 2006, offices remained the lowest performing sector.
Capital values rose by 1.2%, whilst income return rose to 5.3% in 2006 from 5.0% in 2005. In 2006 market rental growth at the All Property level was down to -0.3% from 1.2% in 2005. All sectors registered decelerating rental growth in 2006.
Associate Director of IPD, Dr. Nassos Manginas, said, "We saw a further rise in total returns in the still fledgling Austrian Index, following the trend in the two previous years. Most notably the retail sector outperformed again, mainly due to a strong performance of retailers in Vienna."