Commercial Property Price Index®
Pan-European Commercial Property Price Index
A New (Nominal) High
London, 7 April 2022 - The Green Street Commercial Property Price Index increased by 1.5% during the first quarter of 2022. The index, which measures pricing of a broad swathe of Pan-European commercial properties, notched another new high. Industrial demand remains unabated with asset values increasing over 3% in the most recent quarter. Retail experienced modest yield compression lifting values ~2%. Income growth pushed residential values ~1% higher. Uncertainty in the office sector remains as asset values are largely unchanged.
“Commercial real estate asset values notched higher on a nominal basis in the first quarter of this year,” said Peter Papadakos, Managing Director at Green Street. “Elevated inflation expectations, dearer debt costs, and the fallout from the war in Eastern Europe are top of mind for commercial real estate investors. Property return premiums over fixed income yields, well above their long-term average at the start of 2022, are now slightly below their long-term average. At the sector level, industrial is relatively best positioned with low starting vacancy rates and a backlog of tenant demand. Income growth in the residential sector remains resilient, but rising debt costs are eroding away prospective levered returns in a sector with pre-capex initial yields hovering near 3.0%. The current macro backdrop warrants caution in underwriting assumptions; based on our numbers, commercial real estate pricing in Europe now tilts towards the expensive side of a fair range.”
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How is our index different than others that track commercial property prices?
Green Street Commercial Property Price Index®
Green Street Commercial Property Price Index
Indexed to 100 in August 2007
Indexed to 100 in September 2007
Download CPPI® Report Download CPPI DataCore 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
7 April 2022