Oracle was making the claim that they could serve up data faster than flat files as of about 11g. I've never seen hard stats for real-world scenarios, though.
In this particular case, I'd tend to vote against properties files. I like to edit properties file with a text editor and editing a 10MB file with Windows WordPad isn't something you'll want to do twice. Notepad had a 64KB limit, so that one was right out. Even vi and Emacs don't handle that much text with a lot of agility.
Properties files are typically read-only or read-mostly and the
Java support mechanisms for them reflect that usage. you have to load and unload the entire file, not just individual items.
Also, if the app is already using a database, the overhead in both programming and performance for keeping properties in a database becomes mostly moot, since you've already paid the entrance fee.