5.6.15: Cap Rates Continue to Compress

Going-in capitalization rates compressed nationally across all product types and classes in 2014, according to Integra Realty Resource. This national trend was strongest with respect to Class A Industrial product as well as Class A CBD Office assets. As these asset classes’ capitalization rates contracted in 2014, they passed Community and Neighborhood Retail as investors’ sixth and seventh most preferred asset classes, respectively, continuing to trail the four multifamily sectors as well as Regional Malls in terms of the strength of their capitalization rates.

Average Going In Cap Rate   2014   2013
Urban Multifamily – Class A 5.52% 5.76%
Suburban Multifamily – Class A 5.67% 5.87%
Urban Multifamily – Class B 6.38% 6.38%
Suburban Multifamily – Class B 6.50% 6.53%
Regional Mall Retail 6.83% 7.01%
CBD Office – Class A 7.05% 7.37%
Industrial – Class A 7.11% 7.50%
Community Retail Center 7.17% 7.26%
Neighborhood Retail Center 7.33% 7.41%
Suburban Office – Class A 7.43% 7.68%
Flex Industrial 7.79% 8.01%
CBD Office – Class B 7.84% 8.00%
Suburban Office – Class B 8.06% 8.23%
Lodging – Full Service 8.13% 8.31%
Lodging – Limited Service 8.78% 8.96%
Advertisements
This entry was posted in Commercial Lending, Michael D. Sneden, News & Recent Closings, Valuexpress and tagged , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s