However the hole left in the investment market by the institutions has been filled by the private property company sector and overseas investors. Privately owned property companies invested a net £1.5 billion ($2.2 billion) and overseas investors £2.2 billion ($3.2 billion) in 2001.

Property Data Director Mark Pickering said: 'Private property companies are committing an enormous amount of money to the market at the moment, the sale and leaseback deals with Woolworth's and Marks & Spencer are prime examples. Their hunger seems to be driven by the historically low cost of borrowing and the favourable impact that gearing can have on returns. Institutions, on the other hand, are having to take stock because returns on property could under perform equities this year and their weightings in property are looking relatively high.'

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