Spain’s property returns are at their highest level for a decade, according to MSCI.

It recorded a 15.3% total return in 2015 in Spanish property investment in its IPD Spain Annual Property Index.

The index tracks the performance of 475 investments, with a total capital value of €17.6bn as of December 2015.

The total return marks a significant rise from 9.4% in 2014 and is the strongest performance since a record 16.9% in 2006.

Luis Francisco, MSCI senior associate, said: “The strong results achieved in the property market since the booming years of a decade ago signal the health of the sector and its newfound resilience.

“Yield compression created incentives for investors in the acceleration of capital value growth. We also saw that real estate became an attractive asset class for investors as it outperformed bonds and equities.”

MSCI said performance was last year driven by strong capital growth, which accelerated to 9.7% from 3.6% in 2014.

Robust capital value growth is a result of yield compression and rising market rental values.

The improvement in capital return has been seen across all market sectors, especially in the office, industrial and retail sector.

Income return fell to 5.2% in 2015 from 5.6% in the year before.

Office was the best-performing sector in 2015 with a total return of 17%, followed by industrial and retail with 16.2% and 14.2%, respectively.

Madrid CBD offices and large shopping centres were the top-performing segments in 2015.

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