It’s Likely Way To Early To Call A Bottom In Commercial Real Estate ……..
Posted By thestatedtruth.com on July 23, 2009
Commercial Real Estate Prices in Freefall
Boston Business Journal – by Katherine Conrad San Jose Business Journal
Thursday, Â July 23, 2009
Commercial real estate values around the country have dropped 35 percent from their peak in October 2007, according to Moody’s REAL Commercial Property Price Indices.
The decline appears to be accelerating as the index dropped more than 15 percent during April and May. Transactional volume also fell along with value, which is showing signs of effects from distressed sales.
“May marked a new low for both counts,†the report said.
Along the lines of kicking a sector when it’s down, a rise in interest rates caused several deals to unravel, hitting apartment sales the hardest.
To calculate the index, Moody’s used 52 repeat sales, which had a dollar value of $400 million in April 2002.
Dan Fasulo, managing director of Real Capital Analytics, said Moody’s report is beginning to reflect true market pricing conditions “well ahead of any other indicators†and noted that commercial property values have fallen more than residential prices in annual terms.
http://boston.bizjournals.com/boston/stories/2009/07/20/daily45.html
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