(WSJ) Commercial real-estate prices fell 8.6% in April as deals were closed after having been negotiated during the dark days of late 2008 and early 2009, Moody’s Investors Service said.
“The size of April’s decline, following a 5.5% decline in January, also suggests that sellers are beginning to capitulate to the realities of commercial real-estate markets,” says Moody’s Managing Director Nick Levidy. He added more distressed sales appear to be occurring.
The monthly decline, which leaves prices down one-quarter from a year earlier, continues the losing streak for the commercial real-estate sector, which had held out longer than residential real estate. However, commercial real estate began to feel the recession late last year, as retailers and other businesses cut back when financial markets and consumer sentiment were plunging.
Overall sales volume also fell sequentially in the month to 285, the lowest level since Moody’s began tracking the figures in 2000.
By region, apartments are holding up the best in the East, down 12%. The South, the worst-performing region over the past year, saw declines of more than 20% in all sectors.
The three major office markets – New York, San Francisco and Washington – suffered declines as well, with Washington posting the biggest year-over-year fall at 21%. New York and San Francisco had declines of 13% and 20%, respectively.
Source: Wall Street Journal
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