Lenders' Insatiable Appetite for Commercial Real Estate
Watching the Watchers: The Metrics of the Real Estate Recovery | In Manhattan and other major markets, the consensus at mid-year holds that commercial real estate investment and credit market conditions have improved markedly since last summer. There is a lot of support for this assessment: clear evidence of rising transaction volume; an increasing diversity of lenders extending credit in support of property sales and the refinancing of maturing mortgages; and an uptick in the gross absorption of available space. Along each of these dimensions, the commercial real estate market has recorded significant progress.
But as Dr Chandan explains in his column for the New York Observer, the generally consistent headline investment, credit and fundamentals trends mask a substantial and increasing divergence between several of the market’s most oft-cited pricing metrics. In its most recent report, released last week, CoStar’s General Commercial Index fell to a new cyclical low. Meanwhile, Green Street’s CPPI extended its advance, closing to within 10 percent of the market’s 2007 peak.
Why the difference? Find out at the New York Observer website, in The Metrics of the Real Estate Recovery.