Commercial property price growth in the U.S. commercial real estate market – including Philly office space and Philly retail space – picked up in April after a slower than expected first quarter, according to the latest CoStar Commercial Repeat Sales Index (CCRSI) released this week.
The two major CCRSI indices analyzing the U.S. and Philadelphia commercial real estate market rebounded during the month as investors returned to the market and resumed sales activity after a pull-back at the beginning of the year. The value-weighted U.S. Composite Index increased 0.9% and the equal-weighted U.S. Composite Index grew 0.6% in April 2016.
This report on national and Philadelphia commercial properties was made through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.
Sales of U.S. and Philadelphia commercial real estate properties remain muted compared with last year, reflecting the slow start. Composite pair volume of $33.4 billion year-to-date through April 2016 was down 9.2% from the same period last year.
The sales of national and Philadelphia commercial real estate listings reflected the general economic slowdown seen in the first quarter as financial market volatility over global political concerns took a toll on the general economy at large. Due to the slow start to the year, CoStar analysts do not expect property price growth in the U.S. commercial real estate market to match the record pace of the last two years.
The investment-grade segment of the market – including Philly office space and Philly retail space – was hit particularly hard. Transaction volume was down 11.2% in the investment-grade segment and 4.1% in the general commercial segment in the first four months of 2016 from the same period in 2015.
However, liquidity measures indicate continued healthy investor sentiment for U.S. and Philadelphia commercial real estate listings, and the positive outlook for CRE fundamentals suggests the asset class should continue to attract investor interest.
The average time on the market for for-sale properties dropped 19.7% in the 12-month period ended in April 2016 and the sale-price-to-asking-price ratio narrowed by 2.9 percentage points in the 12-month period ended in April 2016 to 94.3%, the highest this ratio has been since August 2006 and further indication of positive investor sentiment.
For more information about Philly office space, Philly retail space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) Leor Hemo (leor.hemo@wolfcre.com) or Lee Fein (lee.fein@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space and Philly retail space.
Wolf Commercial Real Estate is a Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.
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