Peter Pays Paul

Inside commercial hard money lending.

30 Jan

Determining Market CAP Rates

Category: Commercial Real Estate

Chris Rodriguez of Retail Chatr has written on Determining Market CAP Rates. It details how CAP Rates have fallen during this recession and where they could go.

Now we are in a recession and retail property prices are moving as fast as the stock market. It is almost impossible to accurately pinpoint a property’s value as there is no common motivation from the buyers in the marketplace. One buyer is yanking money out of stocks to buy something more “secure” while another is in a 1031 exchange having sold at a great price and is now watching as his purchasing power increase daily. Not to generalize too much, but yesterdays 5.00% – 5.50% CAP Rate single tenant properties are (or should be) trading between 6.25% – 7.25% CAP Rates, depending on the lease terms, strength of the tenant and location.

Tags: cap rate, cap rates, chris rodriguez, Commercial Real Estate, Retail, retail property, retail real estate


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Posted Friday, January 30th, 2009 at 1:22 pm
Filed Under Category: Commercial Real Estate
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