European commercial property produced a positive total return in the first quarter of 2024 after six consecutive quarters of negative returns.

Data from MSCI showed that European real estate produced a 0.4% return in Q1. Capital values still fell by an average of 0.8% across the region, but average income return growth of 1.2% put the sector into positive territory, and MSCI said that the fall in capital values is slowing.

Two weeks ago, MSCI said that European deal volumes increased in April year-on-year for the first time in 21 months, rising by almost 20% on the same month last year. It pointed out that one month does not make a trend, but that the peak-to-trough period for deal volumes post financial crash was also 21 months.

The firm’s quarterly index measures the performance of 12,679 properties with a total value of €279B (£236B).

Of the three largest Western European markets, UK commercial real estate delivered a 0.7% total return while the French market was little changed with a 0.1% total return. Southern European markets like Spain and Italy were the top performers, followed by the Netherlands.

German commercial properties generated a negative total return of -0.4%.

Offices were the only sector to produce a negative quarterly total return, posting a figure of -0.6%. Retail assets delivered a 0.9% total return, and the total return for industrial properties was 0.8%.