| According to the Green Street Commercial Property Price Index, commercial property prices tanked 13% from their peak in May, taking a 7.3% hit in October. Multiple CRE sectors are suffering double-digit losses; apartments, offices, healthcare facilities, and strip malls. Industrial properties fell by 17%, second only to shopping malls, which are down 24%.
Still dodging and weaving: A few sectors have proven more resilient than others amid the price declines. Hospitality is staying strong, only experiencing a 6% price drop since the sector’s peak in May 2022. Self-storage is in the same boat, with prices down 6% as well. |
THE LONG & SHORT OF IT |
The ongoing war against inflation: Last week, the Fed hiked the key federal funds rate by 75 basis points to battle 40-year high inflation. It was the sixth rate increase this year, and it raised short-term borrowing rates to their highest levels since the Great Recession. “As large as the decline in pricing has been, I don’t think we’re out of the woods,” said Peter Rothemund, co-head of strategic research at Green Street.
Story courtesy of CRE Daily
Image Credit #SeanPollock
