Commercial real estate intelligence provider Altus Group has reported a 0.7% rise in commercial property values across its pan-European valuation dataset in Q1 2026 – the seventh consecutive quarterly increase, according to Altus data seen exclusively by Property Week.

The data shows a moderate acceleration in a recovery that began in Q3 2024 after a two-year period of market-wide write-downs, with the Q1 figure up from a 0.4% rise in Q4 2025.

Cashflow fundamentals were the primary contributor to Q1 gains, providing a 1% value change, supported by continued growth in contract and market rents.

Valuation yields expanded for a second consecutive quarter, tempering appreciation slightly by -0.1%. Over the full year, values rose 1.7%, entirely driven by cashflow improvements, according to Altus.

However, despite these recent positive trends, annual values are still down 1.6% over three years and 0.9% over a five-year period.

Phil Tily, senior vice-president at Altus Group, said: “The quarter’s gains underscore a recovery that remains cashflow-led, with improving contract and market rents doing most of the heavy lifting.

“At the same time, modest outward yield movement is a reflection of ongoing market caution as investors and valuers navigate a complex macro and geopolitical backdrop.”

The residential sector was the strongest-performing property type in Q1, with values up 1.2%, extending its lead over the market average.

Performance was driven by robust cashflow growth contributing 2% to values, with in-place rents strengthening more than the overall benchmark average, although this was partially offset by a 0.8% outward yield movement as valuers applied continued caution.

Meanwhile, industrial assets produced steady performance in Q1, with values rising 0.7%, supported by a 1% positive cashflow aspect, and a slight pull-back from yields of -0.1%.

The UK had a relatively subdued Q1 with values up just 0.1% as a result of yields increasing over the quarter, according to Altus.

In the office sector, values rose a modest 0.2% in Q1, remaining the weakest performing of the main sectors. The UK office sector suffered a setback in Q1, with values down 13% as increased capital put downward pressure on values and valuation yields increased, Altus said.

Over the quarter, retail values increased 0.7%, matching the overall market with gains reported across each property subtype. With yields largely stable and limited capital drag, cashflow gains translated more directly into value growth, led by retail parks and warehouses, which benefited from yield compression and above-average market rent growth.