For the third consecutive month, US commercial real estate prices
saw their value rise in November, as the economy showed signs of recovery.
According to data released by Moody's Investors Services, prices climbed by a further 0.6 per cent over the course of the month compared to October. This means that commercial properties in the country are now 6.4 per cent ahead of the eight-year low which they experienced in August.
However, the Moody's index still remains 42 per cent below its peak in 2007, although there are promising signs boosting its recovery.
Around 1.1 million jobs were created in 2010, the most since 2006, helping to make commercial real estate more attractive to investors
and stabilising prices. Indeed, growing employment in the country helps to support demand for office properties, Christopher Cornell, an economist at Moody's Analytics Inc, explained.
"Demand really has to kick in before you see a significant upward trend [in prices]," Mr Cornell told Bloomberg. "The ones that are really headline properties are doing fairly well, others not as well."
- Wednesday 26 January 2011