What to Consider When Values Start Flat-Lining in 2018

Muoio: “In our projections, we predict an economic downturn in 2019-2020. We chose this period because by then the economic cycle would be exactly twice the average age of cycles in the US since World War II.”

IRVINE, CA—When commercial real estate values start flat-lining in 2018—which he predicts they will—watch what happens with interest rates and real estate fundamentals like vacancies and rents that drive NOI, Ten-X’s Peter Muoio tells Globest.com. As we recently reported, the major commercial property sectors have seen mixed results when it comes to pricing growth, with three of the five posting modest gains in October from the previous month, according to the firm’s Commercial Real Estate Nowcast. Apartments once again led the winners’ parade, while retail and hotels fared less well in October.

We spoke exclusively with Muoio about CRE valuations and when we might begin to see them flat-lining.