Much like other parts of the U.S. economy, commercial property sales fell when the pandemic began. By the second full month of the pandemic, settlements on commercial real estate transactions were about one-half the prior year’s level, hitting a 10-year low in May 2020 and down nearly 50% from one year earlier.
The commercial property market rebounded strongly as the economic recovery began and financing costs fell to record lows. By June 2021 apartment building and nonresidential sales reached a 15-year high, the largest sales count since June 2006.
The pickup in sales occurred across all major property types and pushed settlements higher than the year before the pandemic.
Comparing the second quarters of 2019 and 2021, property sales were up 26% for multifamily and 16% for non-residential properties, with increases across all property categories.
A decline in cap rates during the last year has supported commercial property values. Job growth and rising single-family home prices have increased demand for apartments, leading to lower multifamily vacancy rates in recent months and an increase in building values...
