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Overall commercial property prices squeaked out growth in August, edging up by 0.2% from a year ago and 0.6% from July, according to MSCI's RCA Commercial Property Price Indexes.
MSCI attributed the increase in part to optimism around interest rate cuts and what they might mean for the market overall.
The improvement isn't spread across all asset types, however.
Industrial prices have seen a bounce back from their low, which the property index put at midyear 2023. Since then, industrial prices sustained 12 months of growth and in August saw a 6.9% increase compared to the previous year, according to the report.
Office and apartments, on the other hand, continue to struggle.
Central business district office, the most severely affected office type, was down 27.4% compared to August 2023 and 1.5% compared to July. Office as a whole saw prices decline 9.6% year-over-year, and suburban office prices dropped 4.7%.
Office utilization numbers have been flat, according to a recent NAIOP study. NAIOP projected negative absorption of 11.8M SF nationally for the final three months of the year, Bisnow previously reported.
Apartment prices were down 5.7% from August 2023 but up month-over-month by 0.1%, marking the first time the sector posted price index growth since July 2022, the MSCI report says. A flood of supply in key markets has boosted concessions as landlords fight to attract tenants. Delinquencies have also risen swiftly in the sector.
Retail saw a 0.1% rise in prices year-over-year, while all other commercial property types posted a 2.4% increase over the previous August.
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