The outlook for global commercial property markets will be determined by the exact future path of the two-speed economic recovery currently underway, according to DTZ's 2011 Global Outlook report. Strong GDP growth projections in most Asian and CEE countries will trigger strong occupier demand. In turn, this underpins strong rental and capital value growth. In contrast, a protracted recovery in the Euro-zone with slow GDP growth will produce more subdued increases in rents and capital values.

The report forecasts modest capital growth across most regions between 2011 and 2015. However, current economic, financial market and regulatory uncertainties will continue to influence the pattern of recovery. DTZ research predicts that during the next five years, rental growth will be the primary driver of capital value growth, since further yield compression from the current low level is unlikely. Consequently, total return is forecasted to be lead by existing income yield, especially in Western European markets.

The DTZ report presents a base case for global property forecasts on the assumption that the economy shows real global GDP growth of 3.8% per annum over 2011 to 2015. To quantify the impact of the economic and financial uncertainties, the report presents the results of upside (+0.5% pa) and downside (-0.6% pa) economic scenarios. The analysis calculates the impact of changes in GDP growth on the prime office market rent forecasts. Office rents are most sensitive to GDP variations in Tokyo, Hong Kong and Frankfurt, less sensitive in Paris, London West End and Singapore, with New York the least affected.

Tony McGough, global head of Forecasting & Strategy Research at DTZ commented: 'Significantly, office rental growth forecasts remain positive under the downside scenario in all markets, except Tokyo, implying that the prime rental recovery will remain firmly entrenched.'