Conversely, the Northeast was especially hard hit by pricing declines for retail properties during May, and the sector itself suffered the biggest contraction in May as prices slipped by 1.2% from April. The previous month's gain of 3.6% now appears to be an anomaly, since values on retail properties have slipped for four of the past five months and the segment's Y-O-Y pricing growth is now just 6%. Ten-X attributes retail's valuation struggles in part to the negative media coverage around high-profile store closings and downsizings as e-commerce has continued making inroads against brick-and-mortar sales.

Although hotels' pricing decline was comparatively modest at 0.2%, the sector has also been the weakest for growth over the past year. Ten-X says prices for lodging properties are up just 2.6% from the year-ago period, and cites investor concerns about a large influx of supply coming to gateway markets that are already hampered by declines in international tourism.

Industrial saw a slightly bigger monthly drop in pricing at 0.6%, but the sector overall has been a stronger performer since May 2016. Values for industrial properties are now up 5.5% Y-O-Y following May's price contraction.

For consistency, it's hard to beat the apartment sector, but for Y-O-Y price growth, office is the clear front-runner on a Y-O-Y basis. Office pricing grew by 0.3% in May and is now up 22.3% over the past 12 months. On a regional basis, the Southwest was the only area of the country to post gains or hold steady across all five sectors in May, and registered the largest increase in office pricing for the second consecutive month.

IRVINE, CA—It was a case of two steps forward, one step back for commercial property pricing in May. Ten-X's latest Commercial Real Estate Nowcast shows that prices declined by 0.1% over the past month after an encouraging 2% gain in April. The reversal marks a return to the flattening of pricing growth that the market saw in the months following the presidential election six months ago.

“May proved a perfect example of today's variegated commercial real estate landscape, highlighted by apartments' continued run-up in pricing and the ongoing uninspired results from the hotel and retail sectors,” says Peter Muoio, chief economist at Ten-X. “As uncertainty continues to hover around much of the market, we are unlikely to see the across-the-board growth needed to lift it out of its current slump in the near term.”

Multifamily's reign as the most consistent sector for pricing growth continued in May with a 0.1% monthly increase. The segment has now posted 18 consecutive months of growth, and pricing has gone up 15.2% in the past 12 months, compared to year-over-year price growth of 10.2% for commercial properties across the board.

Cap rate spreads are tight and NOI gains have slowed, indicating a fully valued sector; nonetheless, Ten-X notes that investors continue flocking to multifamily. The best region for growth over the past month was the Northeast, which significantly outperformed all other regions in this regard, Ten-X says.

Conversely, the Northeast was especially hard hit by pricing declines for retail properties during May, and the sector itself suffered the biggest contraction in May as prices slipped by 1.2% from April. The previous month's gain of 3.6% now appears to be an anomaly, since values on retail properties have slipped for four of the past five months and the segment's Y-O-Y pricing growth is now just 6%. Ten-X attributes retail's valuation struggles in part to the negative media coverage around high-profile store closings and downsizings as e-commerce has continued making inroads against brick-and-mortar sales.

Although hotels' pricing decline was comparatively modest at 0.2%, the sector has also been the weakest for growth over the past year. Ten-X says prices for lodging properties are up just 2.6% from the year-ago period, and cites investor concerns about a large influx of supply coming to gateway markets that are already hampered by declines in international tourism.

Industrial saw a slightly bigger monthly drop in pricing at 0.6%, but the sector overall has been a stronger performer since May 2016. Values for industrial properties are now up 5.5% Y-O-Y following May's price contraction.

For consistency, it's hard to beat the apartment sector, but for Y-O-Y price growth, office is the clear front-runner on a Y-O-Y basis. Office pricing grew by 0.3% in May and is now up 22.3% over the past 12 months. On a regional basis, the Southwest was the only area of the country to post gains or hold steady across all five sectors in May, and registered the largest increase in office pricing for the second consecutive month.