Real estate returns expected to lag

The 10-year total rates of return for all real estate markets from 2005 to 2015 is expected to range from 7.5% to 9%, about 300 or 400 basis points lower than the previous decade, according to a new industry report. Retail property with grocery stores as anchor tenants are expected to generate the highest total returns among major property types over the next decade, the report noted. Due to high vacancy levels, industrial properties are expected to lag slightly behind other property types. The report, Expectations & Market Realities in Real Estate, is produced by Principal Real Estate Investors, Real Estate Research Corp. and Torto Wheaton Research.