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NEW YORK CITY-The biggest one-month drop in the eight-year history of the Moody’s/REAL National All Property Type Aggregate Index was recorded during January, Moody’s and Real Estate Analytics LLC reported on Monday. The monthly decrease of 5.5%, compared to a 2.2% drop registered for December 2008, puts the index back at levels last seen in spring 2005.

According to a release from New York City-based REAL, the index has now declined 19.1% year-over-year and is off 21% from its October 2007 peak of 191.87. The January index of 151.58 followed the December ’08 index of 160.46, and is roughly equal to the April ’05 level of 151.29. The index has not fallen below 160 since July of ’05.

“While it is unsettling to see the sharp deterioration of commercial real estate values, the CPPI continues to perform as an accurate and timely benchmark for the asset class,” says Neal Elkin, president of REAL, in a release. He adds that the January drop-off reveals that “declines are accelerating and permeating all regions and property types.”

REAL began compiling the monthly index, which is derived from Real Capital Analytics transaction data, in December 2000. That month’s index of 100 has served as the baseline for monthly increases or decreases. The index rose steadily until October ’07 and began declining each month thereafter except for February and September ’08.

The month-to-month declines recorded in the Moody’s/REAL index follow the news in late December that the Standard & Poor’s/GRA Commercial Real Estate Indices showed back-to-back annual prices declines for only the second time in the S&P index’s 15-year history. At that time, David Blitzer, managing director at S&P, commented, “Overall, the data are not pointing to one clear direction in commercial real estate prices. We cannot tell if this is just a temporary pause in the decline of commercial real estate prices or have we reached the bottom and a turnaround is imminent.”

Unlike the Moody’s/REAL All Property Type Aggregate Index, which is measured monthly, national and regional data by property type are measured on a quarterly basis. Changes in those indices, if any, will be reported in May, according to REAL.

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