Where the Deals Have Been This Year
The $1.1 billion deal for the Port of Los Angeles Distribution Center led the nation.
CRE sales volume dropped in each of the top 25 U.S. markets in the first half of 2023.
In some cases, there were precipitous slumps from the same period a year earlier – 75% in Seattle, 73% in Orlando, 72% in Charlotte, 70% in Houston, and 69% in Atlanta. In other cases, the fall was less severe – 46% in San Francisco, 41% in Northern New Jersey, and 37% in Broward County, FL. “Deal volume in each market fell at double-digit rates in the first half of the year compared to the same period a year earlier,” according to MSCI’s Capital Trends report.
Some sales stood out. The $1.1 billion deal for the Port of Los Angeles Distribution Center, which accounted for almost one-third of the metro’s total industrial volume, led the nation. It contributed to the $9.2 billion total sales achieved in Los Angeles – down 48% from the prior year. The industrial sector accounted for 41% of activity there while apartments accounted for 28%.
Another landmark deal was scored in Manhattan with a partial interest deal for 245 Park Avenue. The sale of a 49.9% stake in the 1.7 million-square-foot office tower to Japanese developer Mori Trust hauled in $998 million. Sales of single assets dominated in Manhattan, with 14 individual property sales of more than $100 million each. The city achieved a total sales volume of $5.45 billion – a drop of 58% from the prior year – but still enough to land the Big Apple in 3rd place nationally.
Dallas lost its front-runner status to Los Angeles. It represented the second most active market with total sales of $8.1 billion – 68% below the prior year. More than half of sales volume was attributable to apartments, with one portfolio sale of 25 apartment assets accounting for 10% of total volume. Multifamily sales also constituted more than half of sales in Austin, Seattle and San Francisco.
Chicago, with sales of $5.3 billion, took fourth place, followed by Atlanta with $4.96 billion.
Distressed sales also played a role in some markets in the first half of the year, especially in Los Angeles, Houston, and Northern New Jersey.