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RCA Report: Industrial Sector Continues to Drive U.S. Price Gains; Retail Rebounds
Prices for commercial real estate in the U.S. rose 6.3% from a year ago in February, according to the latest research by Real Capital Analytics (RCA). The improvement was led by gains in industrial property prices
RCA’s Wyatt Avery wrote the summary report that showed the US National All-Property Index rose 0.6% in February from January. Industrial properties posted a monthly price increase of 1.0% in February, and also posted the largest year-over-year gain of 8.2%, just outpacing the apartment index, which was up 8.1% from a year ago.
On the office front, RCA reports CBD properties posted a relatively strong monthly gain of 0.6%, and year-over-year growth of 2.1%. Last year’s momentum in the suburban office sector disappeared though, coming in flat for a third consecutive month. The all office index increased 5.3% since last February.
RCA reports retail prices actually climbed 0.3% from January, and 2.9% year-over-year. RCA’s Avery points out “this sector experienced drastic declines in price growth in 2015 and 2016, but has been slowly making up ground since then. The level of annual growth seen this month was the highest the sector has shown in more than two years.”
Transaction volume in the industrial sector posted a strong gain in February, though the increase was due to substantial portfolio sales.
RCA’s Avery wrote, “Across the property types, deal volume fell 4% from a year earlier. Without the benefit of portfolio sales, the U.S. market would have seen a second consecutive month of double-digit declines in deal activity.”
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