The figure is higher than last year's increase of 1.5 per cent and above the UK average of 1.1 per cent, placing the region joint second (with the East Midlands) in the regional growth rankings for 2007/08. The North West was the best performing region with an increase of 2.7 percent.

However, despite what Colliers describes as "encouraging" levels of nominal growth, in real terms - taking retail price inflation into account – annual rental growth has been negative for the past two years.

The Yorkshire and The Humber figure is currently minus two per cent – although this still betters the average annual growth rate for the UK which, in real terms, is minus 3.1 per cent for 2007/08.

In 2007/08, rents in 27 per cent of Yorkshire and The Humber's main retail centres increased, up on the 17 per cent seen in 2006/07.

The proportion of centres with static rents was down from 83 per cent in 2006/07 to 73 per cent in 2007/08, whilst no centres in the region experienced a fall in prime rents in the 12 months to May 2008.

Sheffield's Meadowhall has achieved the top rent in the region every year since 1992, although its Zone A rent has remained at £400 per sq ft since 1999

Dr Richard Doidge, director of research and forecasting at Colliers CRE said: "The only top 10 centres in Yorkshire and The Humber to experience an increase in prime rent were the second highest rented location, Leeds's White Rose Centre – rising from £325 per sq ft in May 2007 to £330 per sq ft in May 2008 – along with Sheffield and York.

"All three centres also appear in the list of top performing centres in the region in terms of rental growth over the past 12 months."

Tom Cullen, director of retail agency at Colliers CRE in Leeds, said the redevelopment of Leeds was "still gathering momentum".

Warning

"Land Securities and Caddick Developments' one million sq ft Trinity Scheme is progressing well and we understand a number of target anchor retailers have been secured or are in the process of legal documentation.

"Eastgate is further away in terms of completion, but it is on the mind of a number of prime operators who are yet to decide on where they want to be in the city centre and indeed whether they wish to take two, or in some cases, three units. The redevelopment of the former Allders department store, recently purchased by Highcross, and now known as Broad Gate, is a hive of activity."

But he warned: "Higher construction, finance and letting costs, softer yields, stagnating rental growth and lower levels of retailer demand have led some developers to question the viability of their schemes and put them on hold until conditions in the retail market improve.

"This is evident in Yorkshire and The Humber, with less space than hitherto predicted being delivered in 2008 and 2009, followed by a larger increase in 2010 and 2011 when the market is expected to pick up again.

"The amount of space in the pipeline for 2012 remains largely unchanged at present."