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MSCI: CRE Pricing Posts Smaller Annual Decline
All U.S. commercial property sectors posted annual price declines in July as deal activity retreated to the lowest level since the onset of the pandemic in early 2020. MSCI Real Assets reported Thursday. The RCA CPPI National All-Property Index dropped 9.6% from a year ago, a smaller annual decline than June’s 10.2% drop, and ticked up 0.3% from June.
The annual price decline for apartment properties once again eclipsed all other sectors at 12.2%. Despite three consecutive months of double-digit annual declines, the apartment index remains 21% above the level seen in April 2020, when the pandemic first affected pricing, said MSCI.
Retail prices fell 8.2% from a year earlier and 0.2% from June, in the largest year-over-year drop in the retail index since July 2010. The industrial index slipped 1.7% from a year earlier and 0.1% from June. Industrial only began posting year-over-year price declines in May.
Although suburban office prices rose on a monthly basis, increasing 0.3% from June, the CBD office index was the laggard among the major sectors, falling 0.6%. The suburban and CBD office indexes fell 7.5% and 9.3% Y-O-Y, respectively. July 2023 was the second-weakest July for office deal activity overall, while for CBD assets it was the worst July ever.
- ◦Sale/Acquisition
