Commercial Property Price Index®
Pan-European Commercial Property Price Index
Property Prices Continue to Decline
Newport Beach, CA, September 7, 2023 — The Green Street Commercial Property Price Index® decreased 0.6% in August. The all-property index—a measure of pricing for institutional-quality commercial real estate—is down 16% from its March ’22 peak.
“Transaction volume has improved, and there’s now pretty good visibility on pricing,” said Peter Rothemund, Co-Head of Strategic Research at Green Street. “On average, prices are down about 15% from their ’22 peak. However, interest rates have been rising—the yield on the 10-year Treasury is now almost 4.3%—and prospective buyers will be lowering their bids. Sellers are usually reluctant to accept lower prices, so deal activity may get quiet for a bit.”
Green Street Commercial Property Price Index®
Green Street Commercial Property Price Index
Indexed to 100 in August 2007
Indexed to 100 in September 2007
All Property CPPI® weights: retail (20%), office (17.5%), apartment (15%), health care (15%), industrial (10%), lodging (7.5%), net lease (5%), self-storage (5%), manufactured home park (2.5%), and student housing (2.5%). Retail is mall (50%) and strip retail (50%).
Core Sector CPPI® weights: apartment (25%), industrial (25%), office (25%), and retail (25%).
Change in Commercial Property Values
Amount property values have increased over this period
September 7, 2023
What makes our Commercial Property Price Index® unique?
There are significant differences between the Green Street CPPI® and other indices that track commercial property prices. Green Street's CPPI® is appraisal-based. Appraisal-based indices are only as good as the valuation estimates used to construct them, and Green Street has long devoted sizable resources to deriving accurate estimates of the values of the properties owned by REITs. Most other indices are transaction-based.
Green Street's Pan-European Real Estate Analytics platform covers 25 of the most liquid European real estate markets across the industrial, office, retail, and residential property sectors. The Commercial Property Price Index is a time series of unleveraged property values across these sectors and markets, and captures the prices at which commercial real estate transactions are currently being negotiated and contracted. Features that differentiate this index are its timeliness, its emphasis on average institutional quality properties, and its ability to capture changes in the aggregate value of the commercial property sector.