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Commercial Property Pricing Declines Steepen in February, Led by Apartments
The decline in U.S. commercial property pricing grew steeper in February, pulled down by a sharp drop in the apartment sector, MSCI Real Assets reported Thursday. The RCA CPPI National All-Property Index dropped 6.9% from a year ago and 2.2% from January.
Rising mortgage costs on top of a series of swift interest rate hikes have put pressure on deal activity and property pricing, the report stated. In February, deal volume across all the major property types fell 51% from a year ago.
Although pricing declined for all property sectors in February, apartment prices experienced the largest annual decline of the major sectors, falling 8.7% from a year earlier. That’s the largest Y-O-Y drop for this sector since 2010.
“Even that annual rate of decline underplays the higher-frequency change: the monthly decline of 2.7%, when annualized, would be a fall of 28.2%,” according to MSCI Real Assets.
- ◦Sale/Acquisition
