Moody’s: CRE prices rose 4.3% in Sept. to highest since May

Commercial real estate property prices increased for the first time since May with a 4.3% gain for  September, according to Moody’s Investors Service. Prices increased 0.3% from September 2009, but fell 36.8% from September 2008. Analysis firm IPD reported last week commercial property values were driven up in the third quarter because of renters or an increase in apartment values. Prices are extremely volatile because of uncertain macroeconomic conditions and the low number of repeat-sale transactions, Moody’s managing director Nick Levidy said. During all three summer months, prices decreased between 3% and 4%. (Click to expand) In September, 153 repeat-sales transactions occurred totaling $3.7 billion, up from $1.87 billion in August. This is the largest dollar amount of repeat-sales transaction since January 2008. Property prices by type were measured over the third quarter, half of which increased and half of which decreased. Both retail and apartment property prices experienced a price increase during the third quarter, according to the report, up 5.7% and up 0.4%, respectively. Compared to the same period a year ago, retail prices for commercial real estate are down 11.6% and apartment prices are up 15.5%. Moody’s said apartment prices were at a recession low this time last year. Prices for office properties and industrial spaces decreased during the third quarter, down 3.8% and 4.3%, respectively. Compared to the year-ago third quarter, when office properties hit a recession low, prices are up 4.4%. Industrial property prices are 1.2% lower than 2009, and the lowest they have been since the recession hit in late-2007. (Click to expand) Atlanta had the most CRE transactions in every category during the third quarter, followed by Boston in both the industrial office sectors, and Chicago in both the apartment and retail sectors. (Click to expand) Write to Christine Ricciardi.