Commercial Property Prices Up Over 2018 Levels, But Not In All Sectors

The US National All-Property Index logged a 6.7 percent gain over April a year ago, but price growth has slowed since a year ago, according to a late May report from Real Capital Analytics.

As the chart below shows, the gaining property types are Central Business District (CBD) Office, Industrial and Retail, in that order. Meanwhile, price growth in the multi-family sector (Apartments) slowed from nearly 13 percent to just over 7 percent during the same period.

(Chart Credit: Real Capital Analytics)

This trend matches our observations in our northwest regional markets where investors have poured money into multi-family investments ever since the recovery started in 2013. Today's s

cant supply and strong demand for apartments and four-plexes has driven up prices and shrunk rates of return beneath 6 CAP levels across the northwest.