RCA Insights

Mixed Messages at Midyear for Commercial Real Estate

By on July 15th, 2016

Preliminary figures suggest that overall deal activity in Q2’16 was down 20% YOY, similar to the declines posted in Q1’16. However, the decline for individual properties was less than half that in the past quarter and year-to-date, and for the month of June sales reached the highest level this year. Also, preliminary estimates for the Moody’s/RCA CPPI suggest that prices began to climb again in Q2’16 after a bit of a pause in Q1’16.

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While the volume declines are relatively broad-based, CBD office posted a gain in Q2’16 and the apartment sector is up slightly for H1’16. Acquisitions by institutional investors also bucked the trend and rose 10% in H1’16.  

On July 21 we will publish our US Capital Trends reports with a full analysis of the past quarter and midyear results.

Jim Costello

Jim Costello

Senior Vice President
jcostello@rcanalytics.com

Jim Costello has worked in the CRE space on issues of urban economics since 1990, including a 20-year stint at Torto Wheaton Research. Jim expanded the reach of the Torto Wheaton Research team developing forecasts of global market fundamentals. He also developed approaches to pair the forecast results with frameworks to answer investor questions on asset values and relative investment opportunities.

In the aftermath of the Global Financial Crisis, Jim provided advice to the Treasury Department and helped educate these professionals on commercial real estate performance. Jim is a member of the Commercial Board of Governors of the Mortgage Bankers Administration, where he helps policy makers understand the commercial real estate industry.

Jim is expanding the capabilities of the Real Capital Analytics team on issues of real estate market dynamics. Jim has a master’s degree in economics and is a member of the Counselors of Real Estate.