IPI invesco property3 Mar 2010 20:12
March 3, 2010
By Dees Stribling, Contributing Editor
Courtesy Flickr Creative Commons user Olof S
Green Street Advisors reported on Tuesday that its Commercial Property Price Index rose by 1 percent in February, compared with the previous month. According to the company, U.S. commercial property values have now risen by a little more than 10 percent since hitting a trough in May 2009, but values are still off by roughly 30 percent from their ’07 peak.
Valuations are still a little tough to gauge, however, since CRE transaction volume remains low. Still, according to Green Street, pricing on transactions that have recently closed or that are in the works continues to surprise on the high side.
“The good news is that pricing has been firming since the middle of ’09, especially in the last six months,” noted Mike Kirby, Green Street’s director of research, in the report. “Sellers are feeling less pressure to act, the outlook for fundamentals has become clearer, well-capitalized buyers are becoming plentiful, and return requirements across capital markets have come down.