At this point, the conditions in the office market are starting to look like an experiment in an economics thesis on Dutch auctions, where pricing keep dropping until someone bids and buys. "How cheap is cheap enough to jump into the office sector?" asked MSCI in an examination of capital trends in the U.S. office market. "Investors have still not figured out the answer to that question, with another month of double-digit declines in deal volume for August. The harshest decline was seen for CBD office assets. The $548m in deal activity for the CBD office sector for the month was the worst August on record, in our coverage. By comparison, the second-worst month on record was in August of 2009 when only $580m in deals closed as credit market concerns raged." Worse than the aftermath of the Great Recession. That is bad. Not only was the total small in August, but so were the properties. Out of the 30 office buildings that sold, the average size was 108,000 square feet. In 2019's immediate pre-pandemic market, the average size during the entire year was 166,000 square feet. "Three buildings larger than 300,000 sqft did sell in the month, one in Manhattan at $100 per sqft, and two in the Midwest, one in Milwaukee and the other in St. Louis, both of which were sold out of distressed situations," the firm noted. Looking at year-to-date through August volumes, total office was down by 64%, as was central business district. Suburban was off by 63%, single asset by 58%, and portfolio and entity by a comparatively massive 80%. In some ways, the monthly year-over-year results seemed worse. Office totals again were -64%; but suburban was at -57% while CBD was -79%; single asset, -57%; and portfolio and entity bringing up the rear far behind at -94%. "The lending markets help explain some of the challenges in the CBD office market," MSCI wrote. As shown in The Big Picture report in this edition of US Capital Trends, the number of active lenders in the CBD office market has pulled back more than that for suburban areas. There was a 38% drop in the number of unique CBD office lenders from the peak levels this cycle versus a 33% drop for suburban." Hence, a chicken-and-egg observation. Were the transactions down because of lack of offered lending, or the lending off because of lack of transactions?