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Another Price Drop for Commercial Real Estate

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NREI reports on a drop in the latest S&P/GRA Commercial Real Estate Indices updated through September.

Monthly returns for a national index of commercial properties posted a negative 0.8% in September, the first monthly decline since November 2006, Standard & Poor's reported on Dec. 18 when it released September results of its S&P/GRA Commercial Real Estate Indices. The month's decline marked a reversal of August's 1.1% gain and a 0.6% increase reported in July.

On a rolling 12-month basis, the national index still showed a positive 5.1% return in September. Yet that rate of return was down more than a full percentage point from summer figures, including annual returns of 6.6% in June, 6.4% in July and 6.2% in August.

“On a national scale, annual returns appear to be speeding up in their rate of deceleration,” says David Blitzer, managing director and chairman of the Index Committee at Standard & Poor's. September results of the indices revealed “annual returns at levels not seen since early 2004,” Blitzer added.

Previous posts on the S&P/GRA Indices can be found here, here and here.

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Elaine Misonzhnik

Senior associate editor Elaine Misonzhnik has been writing for National Real Estate Investor since June 2006 and has covered commercial real estate for more than 12 years. She first became...
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