It’s now perfectly obvious that the commercial real estate (CRE) markets have inevitably followed the lead of the residential markets down into an historic recessionary decline.
Today, the MIT Center for Real Estate released their latest read on the nation’s commercial property market showing a steep 15.01% year-over-year decline to prices and a 23.06% decline in demand.
Worse yet, on a peak basis CRE prices have declined a staggering 21.94%.
Individually, Apartment property prices declined 16.34%, Industrial property prices declined 17.24% and Office property prices declined 18.32%.
Looking at the supply and demand indices of the “All Properties” index appears to shed some light on the factors now working to drive prices lower.
Notice that supply of retail properties has remained elevated in recent quarters, while demand has continued to deteriorate substantially.