Commercial Property Price Index
Pan-European Commercial Property Price Index
Pricing Changes Vary by Property Type
Newport Beach, CA, February 4, 2021 — The Green Street Commercial Property Price Index increased 1.1% in January. The increase reflects higher valuations for lodging properties. Pricing in other property sectors was unchanged. The all-property index is now 7% below pre-Covid levels.
“Pricing of properties where the top line is less affected by the pandemic are flat to higher versus a year ago. Property types heavily impacted by shutdowns—or where the ultimate impact from Covid is unknown—are seeing weaker pricing. The exact magnitude of price declines in these sectors, however, is unknown given little product is trading,” said Peter Rothemund, Managing Director at Green Street. “Most of the uncertainty surrounding real estate pricing should clear up over the next several months as the transaction market picks up, and when it does, we expect to see more upside surprises than the other way around.”
Green Street Commercial Property Price Index
Indexed to 100 in August 2007
Indexed to 100 in September 2007Download CPPI Report Download CPPI Data
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
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.