The report below gives a good overview of the third quarter M&A activity in the Commercial Real Estate Industry Sector. According to data released by CBRE, a leading commercial real estate firm, commercial real estate investment volume decreased by 12.7% year-over-year in Q1 to $99.6 billion. However, trailing four-quarter volume increased by 11.6% year-over-year, the second-highest rate since 2015.
Capitalization rates for the quarter declined slightly by 15 bps.
Commercial real estate acquisition volume lagged in Q1 driven by a rise in interest rates and pricing expectations.
Industry Indicators
- US corporate profits, an indicator of commercial real estate demand, rose 3.1% in the first quarter of 2019 compared to the same period in 2018.
- The value of US nonresidential construction spending, a driver for commercial real estate management demand, rose 6.0% year-to-date in April 2019 compared to the same period in 2018.
- US corporate profits, an indicator of corporate demand for real estate rose 3.1% in the first quarter of 2019 compared to the same period in 2018.
- The bank prime loan rate, which indicates changes in the rates available for real estate financing, was 5.5% as of the week of June 13, 2019, up from a rate of 5% the same week in 2018.
Posted by Peter Moore.
Read the Entire Commercial Real Estate 3rd Quarter Newsletter Here