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Yields in prime office markets will be hit hardest in the coming years, followed by prime industrial properties, high-street retail locations and shopping centres, according to Will Rowson, chief investment officer of ING Real Estate Investment Management. Speaking at the annual PropertyNL Forum in Amsterdam on Tuesday, Rowson said he expected that the prime shopping centre market would be the first to recover but that recovery would be slow and gradual. 'Europe has been relatively robust compared to the UK, but 2009 will a tough year all round.There are not many glimmers of light in the tunnel and any light there is is probably a runaway train coming the other way.'

While the UK and US are taking the hardest punches, the downturn in Europe and Japan will be less severe, Rowson said. 'Continental Europe has not seen nearly as many distressed sellers as in the UK, but in the next six months we will see more.'

Central Europe will show the first signs of recovery, Rowson said, but added that this is also where the biggest risks are to be found. 'Czech Republic and Poland are the most promising markets in this region and most akin to the mature west European markets.'

Rowson said his presentation had been changed at the last minute to include the latest updates from ING's economic research department. 'Recovery is moving further out in the monthly updates. We now expect recovery to set in three to six months later than originally foreseen.' Rowson sees the retail sector recovering by 2011 while the office market will not pick up until 2012.