The latest results of the Moody’s/REAL Commercial Property Price Indices (CPPI) suggest a sharp deterioration in CRE values. The Moody’s/REAL National All Property Type Aggregate Index from Real Estate Analytics [REAL], measured 125.04 for May 2009, a monthly decrease of 7.6% from the previous month. The index has declined by 28.5% from January 2008 and is nearly 35% below its peak of October, 2007.
Real Estate Analytics however, while it noted that the transaction volume in the overall market has fallen to its lowest level yet, it also said that the large CRE price declines in the last 60 days — CPPI index is down over 15% in the past two months alone– suggest that a bottom may be starting to form, although “higher transaction volumes would be necessary in order to draw any more definitive conclusions.”
There were only 282 transactions in May, passing the old low set in the early 2000’s.