The prices of U.S. commercial buildings are now higher than their peak in 2007 — just prior to the downturn — according to data from Moody’s Investors Service.
The national all-property composite index increased to 0.2 percent above the level seen in November 2007. Since January 2010, during the depths of the recession, the Moody’s/RCA Commercial Property Price Indices has recorded a climb of 40 percent.
Office properties and apartment complexes in major cities were instrumental in the recent surge of prices. The residential market in the U.S. benefited from low borrowing costs, largely from Fannie Mae and Freddie Mac.
“Multifamily sprang back quicker, since it only had a few quarters where there was a contraction in debt available,” Tad Philipp of Moody’s told Bloomberg News. Other property types “took longer to come back because the liquidity took longer to come back.” [Bloomberg News] — Mark Maurer