Moody's: US Commercial Building Prices Surpass '07 Peak
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The Moody's/RCA Commercial Property Price index has eked above its November 2007 peak, recovering from a more than 40% loss at the January 2010 nadir. The bond credit rating service chalked up the result to big city multifamily and office buildings. Cheap capital, fewer distressed deals and a spike in availability also boosted the number. Tad Philipp, the company's CRE research head, told Bloomberg that apartment buildings performed especially well because of low borrowing costs from lenders like Freddie and Fannie (Reston, VA HQ above). In fact, apartment prices are now an impressive 18% ahead of their pre-crash peak, with the broader index 0.2% ahead of those levels. Retail RE did lag other sectors, but still posted a 5.3% increase from last year.