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US Sales: First Quarterly Gain Since '07

NEW YORK CITY—The third quarter is the strongest year-to-date in most sectors, says RCA, although rising cap rates mean the US lags global results

By Paul Bubny | Updated on October 26, 2009

NEW YORK CITY—For sales transactions of $5 million or more, the third quarter stands head and shoulders above the first six months of 2009, with a 24% gain overall nationwide to reach $12.5 billion, according to Real Capital Analytics. It was the first quarterly rise seen here in two years. However, the US still lags behind the rest of the globe in recovery, including cap rates, which continue to increase domestically while falling elsewhere.

That increase in dollar volume coincided with a 12% decline in the number of deals, according to RCA. In its latest report, the firm says the increase in average deal size can be interpreted as “a positive signal, since larger deals have been rare this year.”

Also seen as positives during Q3 were the “significant” 20% pullback in the aggregate value of new offerings coming to market, suggesting that sellers are becoming more selective or realistic, and the drop-off in new distress. RCA says it declined 33% in dollar volume and 58% in the number of newly distressed properties compared to Q2. However, RCA’s report points out that Q2 was skewed upward by several large corporate bankruptcies.

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