A tale of ___ markets
Green Street just released value updates as of November.
Headline takeaways: values are up 5% YoY, down 18% from the 2022 peak.
---- By property type ----
Meaningful dispersion by property type.
Office down 36% from the peak vs. malls down 6%.
Over the last year, apartments up 14% and malls up 17%.
...lodging down 3%, storage down 2%, and office down 1%.
---- Location, location, location ----
This topic gets much less attention but is emerging as a defining factor.
Pre-Covid, metro markets were very highly correlated, which stands to reason since total returns were largely driven by national/global capital markets and cap rate compression.
But now that capital markets have moderated, meaningful metro-level differences are increasingly defining performance.
---- Big takeaways ----
Multifamily: big declines vs. peak but recovering across all metros
Office: big declines vs. peak and beginning to stabilize
Industrial: moderate declines vs. peak but significant dispersion across metros
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