Over the next three years, retail property is set to deliver average real capital gains of around 1% per year (roughly 3% nominal), lower than the figures of around 3% (5% nominal) in the industrial sector and up to 5% (7% nominal) in the office sector. This is in contrast with the historical experience of post-recession retail outperformance. The retail underperformance that we expect over 2010-12 reflects our view that consumer spending has further to fall.
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