Continuing low returns in the European real estate market, coupled with significant volatility in the region, are giving investment managers a quandary — accept low yields and focus on income or aim for the prizes offered further up the risk curve.

Market participants have warned core real estate managers against adopting higher-risk strategies in pursuit of greater returns, stressing the importance of income in an uncertain market. But is it so wrong to want a higher return from real estate?

JLL says that as of the fourth quarter of last year prime yields in the European office market were as low as 3.00 percent in Paris, 3.30 percent in Berlin and 3.50 percent in London. At the upper end of the spectrum, prime yields in Moscow’s office sector stood at 10.50 percent in the same period.

Meanwhile, prime yields in the region’s retail unit sector stood at 2.00 percent in London, 2.75 percent in Paris and 3.30 percent in Amsterdam. In Moscow — again the hig