Tim Brown, head of strategy at Jewson Associates, said: "Commercial property prices in the UK have fallen 42% from their peak in June 2007 as measured by the headline IPD index. As a consequence, property yields, which were below government bond yields in 2007, now stand at a significant premium.

"The fall in values and rise in yields not only reflects concerns about tenants defaulting and voids rising (as a result of corporate bankruptcies such as Woolworths) but also forced sellers in the market trying to raise money to reduce their debt. The need to reduce debt and strengthen their balance sheets has also caused a number of quoted property companies, such as Land Securities and British Land, to have large rights issues.

"The very weak economic background, particularly on the 'high street', combined-with forced sellers and rising defaults, will keep property values under pressure for some time.

"Nevertheless, the current yield on property suggests that depression aside, commercial property is becoming a cheap asset class. We doubt that values will show much, if any, progress in the near term but for the patient long-term investor with no liquidity constraints now is the time to consider increasing exposure to commercial property."