U.S. commercial property pricing saw its biggest annual decline since 2010 in March, according to MSCI Real Assets, as a double-digit drop in the apartment sector dragged down the broader index. The RCA CPPI National All-Property Index fell 8.0% year-over-year and 1.3% from February, indicating that higher borrowing costs and tighter financing conditions have weighed on deal activity and pricing across major property types during Q1 of 2023 – with volume being less than half of what it was a year prior.
The apartment sector posted the largest price declines on both an annual (10.3%) and monthly (1..9%) basis compared to other sectors – representing quite a contrast from 12 months ago when it was only surpassed by increases in industrial property prices at that time .
