Commercial Real Estate:
Values Rise Slowly As Recovery Spreads
Price Increases In Most Desireable Markets Have Slowed While The Recovery Spreads To Wider Commercial Real Estate Market
Commercial real estate values continue to rise, but not as quickly as they did in 2010 and 2011. Investors are taking a "wait and see" attitude right now … a phenomenon that occurs with every election year regardless of the political situation. Elections always mess up the markets.
The commercial real estate market is no exception. It experienced a fairly quick rebound in '10 and '11. Prices are still rising, but at a slower rate. At the same time we notice the slowing is in the quicker rising most preferred markets, while the slower, less preferable markets are keeping relatively the same pace. This actually means the recovery is spreading to the wider commercial real estate market as a whole, and is good news.
Here's a report from Bendix Anderson in the National Real Estate Investor:
"Numerous price indices show that commercial real estate (CRE) values are on the rise, although now more slowly than in the past. Experts say investors are playing a wait-and-see game that has limited the greatest amount of growth to the most sought …" National Real Estate Investor
Recovery Spreading To General Commercial Real Estate Market
The CoStar index shows us that the "Investment Quality" portion of the commercial real estate market has led the recovery, but that now the "General" commercial market is beginning to follow. This is good news for the commercial real estate market as a whole.
Commercial Real Estate