The story in 2018 for the UK’s total real estate returns was one of decline.

Following positive momentum in 2017, quarter-on-quarter returns last year stepped down from 2.9 percent in the fourth quarter of 2017, to 1.9 percent in the first quarter of 2018, 1.7 percent in the second, 1.4 percent in the third and then 0.8 percent in the final quarter of the year. For the first time in quite a while, the UK experienced negative capital growth on a quarter-on-quarter basis.

One of the most striking aspects of 2018 was the widening spread between industrial and retail returns. The total return for industrial came in at 16.4 percent on an annual basis, while retail entered negative territory for the first time since the GFC with a –0.5 percent posting. This 17 percent spread between the markets is the widest ever recorded between two sectors in the MSCI UK Quarterly Property Index. One has to look back nearly 30 years on the UK Annual Index to the late ’80s/early ’90