U.S. residential real estate wasn’t the only market propped up by government intervention in 2009 and early 2010. According to Moody’s commercial real estate has continued to decline after a brief period of stabilization. Prices fell 3.1% in July marking the second consecutive decline of greater than 3%:
New York, September 20, 2010 — US commercial real estate prices as measured by Moody’s/REAL Commercial Property Price Indices (CPPI) decreased 3.1% in July, the second consecutive monthly decline of more than 3%.
Nationwide, prices are currently 43.2% below their peak in October 2007 and are only 0.9% above the recession low recorded in October 2009.
The CPPI has declined 7.3% in the past year, and dropped 35.9% in the past two years.
“Commercial real estate markets were caught in a downdraft as the economy appeared to further weaken in the early part of 2010, resulting in relatively large declines in the index in the early summer,” said Moody’s Managing Director Nick Levidy. “The recent performance, while perhaps somewhat discouraging, should not come as a complete surprise. We have noted for several months that markets are likely to remain choppy for some time as property values slowly form a bottom in conjunction with a gradual recovery of the broader economy.”