Commercial Property Price Index
Pan-European Commercial Property Price Index
Hitting a New High
London, 7 July 2021 - The Green Street Commercial Property Price Index increased by 1.9% during the second quarter of 2021. The index, which measures pricing of a broad swathe of Pan-European commercial properties, is now above its pre-Covid peak. Industrial values are single handedly driving the index higher, up ~6.5% this quarter as investors bid up assets well above asking prices. Residential values ticked another notch higher – up ~1% – while office and retail values remained flat as uncertainties around lockdown measures, WFH, and rent collections persist.
“Commercial real estate, in aggregate, is now priced above the pre-Covid Peak,” said Peter Papadakos, Managing Director at Green Street. “The ecommerce engine is moving forward with strong momentum and continues increase tenant logistic requirements – about 350m additional square feet will be needed by 2025. Investor’s can’t get enough of the secular growth story with relatively high income growth certainty resulting in upside surprises to industrial asset value. However, income uncertainty remains in the office and retail sectors which is causing a hiatus in asset value movements. Favourable monetary and fiscal stimulus policies remain resulting in a positive outlook for the direction of commercial real estate asset values.”
Green Street Commercial Property Price Index
Indexed to 100 in August 2007
Indexed to 100 in September 2007Download CPPI Report Download CPPI Data
Core Sector Average is equally-weighted between the Industrial, Office, Residential, and Retail sectors.
Change in Commercial Property Values
Amount property values have increased over this period
(as of 7/7/2021)
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.