Recent articles in The Wall Street Journal, U.S. Commercial-Property Sales Plunge, and Another Miami Condo Bust Looms were featured in the publication’s The Property Report section. The former article highlights
just $25.1 Billion worth of commercial property sold in February 2016 compared with $47.3 Billion
during February 2015, and $46.2 Billion in January 2016 “…sending the
clearest signal yet that a six-year bull market might be coming to an end.” The latter article states developers have
started cancelling projects, cutting prices, and offering incentives. More than half a dozen Miami projects have
been put on hold or canceled altogether.
Please refer to the articles in their entirety for more detail.
Entering Q2 2016, the commercial real estate "CRE" market is well
into its sixth year of price recovery following the financial crisis of
2008 / 2009. The availability of low
interest CRE debt, and a greater supply of buyers
versus sellers, have been two significant factors contributing to sustained price
appreciation in recent years. An uptick
in interest rates, combined with a tightening of bank lending standards for CRE
loans, could dissuade investors from making new acquisitions, thus reducing
demand for CRE properties.
The Jacksonville Beach Apartment
Market continues to be healthy. Should
investor demand dissipate as 2016 progresses, or proceeding into 2017, an imbalanced shift toward more sellers than buyers could negatively impact velocity and valuations.
You may contact Patrick Whitney at 904-575-8008
to discuss how these factors may impact the value of your CRE properties or for additional
information regarding Mr. Whitney’s capabilities and how you may benefit from
utilizing his brokerage, capital markets, research, and advisory services to
assist you in achieving your CRE investment goals.
Patrick Whitney
Director, Multi-Family Housing
PH: 904.575.8008
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