According to MSCI Real Assets, commercial property prices in the United States have shown signs of improvement in August, with a 0.6% increase from July and a 0.2% rise from the previous year. This positive trend is attributed to growing optimism surrounding potential interest rate cuts that could revitalize the market.
However, not all property types have seen equal success in pricing during this time period. While industrial properties experienced a dip around mid-2023 due to rising federal funds rates, they rebounded strongly with 12 consecutive months of annual growth and an impressive 6.9% increase in August.
On the other hand, CBD office prices continue to struggle with significant declines of 27.4% compared to last year and another decrease of 1.5% since July alone. However, suburban office assets fared slightly better with only a -4/7 decrease over the past year but still saw some improvement with a modest increase of .5%.
Apartment prices also saw some progress after experiencing drops for over two years straight; there was finally an uptick by .1%, marking their first monthly increase since July of last year when they began declining at rapid rates (-5/7%). Retail properties showed minimal growth as well at just .1%, but when annualized it would indicate stronger gains at approximately +3/8%.
