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CRE Pricing Edges into Annual Growth
U.S. commercial property prices edged into annual growth in August amid growing optimism that interest rate cuts will rejuvenate the market, MSCI Real Assets reported. The RCA CPPI National All-Property Index rose 0.6% from July, for a fourth consecutive month-over-month improvement, and rose 0.2% from a year ago.
Amid a rapid run-up in the federal funds rate between 2022 and early 2023, some property types have performed better on pricing than others, MSCI Real Assets said. Industrial pricing dipped around midyear 2023 but rebounded to post 12 consecutive months of annual growth. In August, the industrial index climbed 6.9%.
While CBD office prices continued to post the most severe declines of any sector, falling 27.4% in August from a year ago and 1.5% from July, suburban office fared better. Pricing for these office assets fell 4.7% over the past year and rose 0.5% from July.
Apartment prices dropped 5.7% over the past year and rose 0.1% from July, the first monthly increase since July 2022. The retail index grew at a yearly rate of 0.1% and rose 0.3% in August from July, which when annualized would indicate a stronger increase of 3.8%.
- ◦Sale/Acquisition
