Gerald Blundell, Head of Investment Strategy at LaSalle, said: 'Property, and especially offices, will deliver a stream of income that is well secured and is less at risk in the corporate balance sheet as we stand on the brink of an economic downturn than either debt repayment or dividends.'

Offices showed by far the strongest growth, with 13.4% rental growth in the year to March 2001 of which 5% has been in the last three months. In many cases, rent reviews are driving the sector forward given the high levels of open market rents that are being achieved, particularly in the centre of London. With most leases on five-year terms, 1991 saw the market in recession while 1996 saw only modest uplift. This year, with £90 ($129) per sf being achieved in the West End of London, tenants have had to face substantial increases, particularly in prime space.

In contrast, rental growth in the retail and industrial sectors was almost zero. Blundell said: 'Despite slowing returns, property still offers good value when compared to other asset classes such as equities and bonds, offering a yield of over 7% and expected unleveraged growth of around 4% over the next five years.'