JAPAN'S growth in office-investment returns slowed last year as gains in property prices eased, according to a survey released yesterday.

Total real estate returns, including capital gains and rental income, reached 14.7 percent last year, compared with 13.1 percent in 2006 and 4.1 percent in 2005, according to the MTB-IKOMA Real Estate Index.

The gauge is produced by Mitsubishi UFJ Trust and Banking Corp and Ikoma Data Service System, a subsidiary of CB Richard Ellis Group Inc, Bloomberg News reported.

Japan's real estate market has cooled this year, as the economy shows signs of slowing and property financing dries up after the collapse of the subprime-mortgage industry.

The slowdown in office-investment return increases was mainly due to weaker growth in property prices as rents remained "stable," said the survey.

Among the 13 cities surveyed, Osaka, Nagoya and Kyoto posted falling returns in 2007, while growth in nine other cities lost speed.