Fresh data from Colliers and MSCI reveals a positive February for commercial real estate sales, with overall volume up 30% year-over-year at $24.4 billion. Year-over-year price changes for office, industrial, retail, and multifamily (leaving out hospitality) were up 1%.
On volume growth, every category was positive except industrial, which was flat at $5 billion in sales volume. Retail had the most significant jump of 105% for $7.1 billion. Next was office, at $3.5 billion, up 55%. Hospitality saw a 20% increase to $1.3 billion, and multifamily had 7% growth to $7.5 billion.
Price changes saw a lot more variability. Retail and industrial both had price gains of 5%. Office prices changed by -3%, multifamily by -1%, and hospitality had the largest drop at -9%. The price index comprises office, industrial, retail, and multifamily only. Had hospitality been included, it might have been a negative price change instead of an overall 1% gain.
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The biggest area for office growth was central business district transactions. Sales in that sub-category were up 217% year-over-year in February. One of the big deals of the month was Sutter Health's acquisition of a 565,000-square-foot portfolio for $450 million from BioMed Realty. Other large transactions were in Fort Lauderdale, Tampa, Denver, and SeaTac, WA.
Industrial was slightly ahead of last year’s February total, but low enough that the percentage rounded to 0%. The number of individual properties sold remained “muted.” Target purchased a building under construction for $231 million in Brighton, CO. REI sold four assets to Madison Capital for $230 million and LSC Communications said goodbye to two properties in Lancaster, PA, to Machine Investment Group for $130 million.
The multifamily gain in February represented the ninth straight year of a year-over-year sales increase. What pushed the transaction count were individual property sales, like Ares Management buying the 392-unit 525 West 52nd St. in Manhattan from Mitsui Fudosan America for $270 million and the sale of the 322-unit 8001 Woodmont in Bethesda, MD, from JBG Smith to Peterson Cos. for $194 million.
Retail had the largest sales gain, much of which came from the Blackstone acquisition of the REIT Retail Opportunity Investments Corp., taking it private for $4 billion. Blue Owl Capital acquired a 165-property sale-leaseback portfolio for $411.6 million from South State Bank.
Hospitality, with its 20% year-over-year gain to $1.3 billion in volume, was also more than January’s total. Both figures, though, were lower than every month in 2024. A significant transaction was Columbia Pacific’s purchase of the 153-room hotel at 250 5th Avenue in Manhattan for $114.4 million. Columbia Sussex Corp. bought 406-room Westin at 1400 M St. NW for $92 million.
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