US commercial property values slipped slightly in March: report

Cap rates continue to flatten while transaction activity slips, according to Green Street Advisors

TRD New York /
Apr.April 07, 2016 02:40 PM

Citing a continuing slowdown in both transaction volume and value appreciation, Green Street Advisors’ national index of U.S. commercial property values fell slightly in March to the tune of less than one-half percent, the real estate research and advisory firm said Wednesday.

As in previous reports, Green Street noted that capitalization rates “have flattened out over the past few months,” corresponding with property appreciation having “slowed materially from the pace of last year” and a related decline in transaction activity.

Though the current commercial real estate cycle has seen property values eclipse their pre-recession peak in 2007, according to Green Street, the slight decline in the national property index feeds into previous forecasts that the cycle may reach its conclusion in 2016.

But despite indicators playing into that narrative, Green Street senior analyst Peter Rothemund said that property values at large “appear to be holding their ground” thanks to financial and securities markets that have stabilized.

“Though that seemed an unlikely proposition a month or two ago, the rally in the financial markets and the return of some normalcy to the [commercial mortgage-backed securities] market have helped property pricing,” Rothemund said.

Green Street’s Commercial Property Price Index remained up 8 percent year-on-year in March and 23 percent above its previous peak in August 2007.


Related Article

arrow_forward_ios
The Watchtower building at 25 Columbia Heights, CIM Group’s Shaul Kuba (right) and LIVWRK’s Asher Abehsera (Credit: Wikipedia, CIM Group, and LinkedIn)

JPMorgan leads $335M refi for CIM and LIVWRK’s Watchtower renovation

Multifamily market still reigns in Queens, Blackstone balks after rent reforms and more of the biggest CRE trends right now

Real estate titans … and their toys

Developer seeks $40M for Opportunity Zone site in downtown Newark

This East End icon might finally be closing in on a sale

Mack-Cali sells Paramus office property, Murphy enacts land bank reforms & more North Jersey real estate news

Power restored after blackout envelops West Side of Manhattan

The rise of the anonymous LLC: Tracing the history of the favorite property investment vehicle

arrow_forward_ios