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Green Street: CRE Prices May Have Hit Bottom
The Green Street Commercial Property Price Index decreased by 3% in November. The all-
property index—a measure of pricing for institutional-quality commercial real estate—is down 22%
from its March 2022 peak, the Newport Beach, CA-based analytics company said.
“The rise in bond yields that occurred in September and October essentially froze the transaction market,” said Peter Rothemund, co-head of strategic research at Green Street. “The good news is that bonds have staged an epic rally since, and commercial property is now fairly priced vs. corporate bonds. Property pricing may well have hit bottom.”
Over the past 12 months, all but one property type tracked by Green Street posted single- or double-digit declines in pricing. The sole exception was the mall sector, where pricing ticked up slightly.
The steepest decline in pricing over the past month was in self-storage, where prices dropped by 7.6%, according to Green Street data. For pricing drops from the March ’22 peak, the most dramatic have been office with a 35% decline and apartments with a 30% decline. Conversely, the smallest decline in pricing was in the lodging sector.
- ◦Sale/Acquisition
