UK – Commercial property total returns in the UK have risen to 0.9% in August, their highest level since March 2011, as improvements in the wider economy continue to filter down into the real estate sector, according to the IPD UK Monthly Index.

IPD attributed the returns to a 0.4% rise in property values, which have grown by a cumulative 0.8% over the four straight months since May this year.

However, IPD also noted that income returns, at 0.6%, have remained steady over the same period.

By comparison, bonds and equities lost 1.6% and 2.4% in August.

IPD said: "All three main sectors saw rising total returns off the back of capital growth, but, critically, the retail sector saw growth for the first time since October 2011."

Additionally, the IPD UK Monthly Index showed that retail property values rose by 0.1% in the month, halting a 21-month cumulative decline of 7.1% and leading to a total return of 0.7%.

IPD also pointed out that growth was not just restricted to London, with shops and retail warehouses around the UK seeing stable or growing property values, while shopping centres continued to see falling values.

Returns rose for regional assets in the office and industrial sectors as growth and improving sentiment filtered out of London and the South East.

In total, offices returned 1.1% as capital values grew by 0.6%, while returns in the industrial sector were their highest in more than three years, at 1.2%.

Phil Tily, executive director and head of UK and Ireland at IPD, said that, at this time last year, values were falling by 0.3% and the economy looked ready to slip back into recession.

"However, in 12 months we have seen economic growth returning – if, indeed, it ever left – consumer and business confidence rising and a raft of improvements in other economic indicators," he said.

"As this growth moves further out of London, income and value-add opportunities in the regions, where income yields often exceed 8%, will start to attract investors willing to move up the risk curve."