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Green Street: CRE Now Fairly Valued vs. Bonds
In relatively good news for commercial real estate values, the Green Street Commercial Property Price Index was unchanged in March. The all-property index, a measure of pricing for institutional-quality commercial real estate, is down 7% over the past year and 21% since its peak in March of 2022.
The pricing plateau between February and March March is the first leveling-off since ’22. Following the recent peak, prices have generally declined on a year-over-year basis, although January of this year saw a 0.3% increase.
“After back-to-back years of significant declines, property prices have regained their footing,” said Peter Rothemund, co-head of strategic research at Green Street. “With commercial real estate priced fairly vs. corporate bonds, the trend of little-to-no change in pricing is likely to continue.”
Not surprisingly, office registered the worst performance month-over-month, Y-O-Y and relative to March 2022. Apartments, retail and lodging all notched marginal improvements in pricing from the previous month.
- ◦Sale/Acquisition
