Cap Rates in Decline for Class-A Properties in All Sectors
Mar 9, 2010 – CRE News
The days of rising capitalization rates are coming to a halt for class-A properties in all commercial sectors, says CB Richard Ellis.
Cap rates for those assets with stabilized incomes in the office, multifamily, retail and industrial sectors last year declined or held flat in more markets than the number of markets in which they rose, according to the brokerage’s analysis of sales data from Real Capital Analytics.
Going forward, CB expects the number of markets with flat or falling cap rates will even more significantly outnumber those in which they increase.
Cap-rate declines last year were slightly less prominent for class-A office, multifamily and industrial properties that are considered value-add in nature. Those are properties whose incomes could be significantly increased through renovations, re-tenanting and other strategies. [more...]
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