The old adage that owners will sell a winner but hold onto a loser seems to be holding true amid the pandemic-fueled slowdown. And that tendency towards potential sellers keeping "losers" off the market seems to be affecting average commercial sales prices.
That's according to a new analysis from New York-based commercial real estate data firm Real Capital Analytics crunching the numbers for the deal volume for office, industrial and retail property that has sold at least once since 2007.
"Those markets where a greater proportion of investors will stay in the money in the event of small-to-medium prices falls are likely to remain more liquid than those where a greater proportion of investors would experience losses in the event of the same drop in market pricing," wrote RCA's Senior Director for the EMEA region Tom Leahy in a blog post.
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Ross Todd
Ross Todd is the Editor/columnist for the Am Law Litigation Daily. He writes about litigation of all sorts. Previously, Ross was the Bureau Chief of The Recorder, ALM's California affiliate. Contact Ross at [email protected]. On Twitter: @Ross_Todd.
