4th Quarter, 2015

Market Commentary™ Investor Survey Reports Modest Cap Rate Index Decrease For Most Property Types During 3rd Quarter 2015

Coincident with a three basis point decrease in Treasury rates to which most commercial mortgage interest rates are indexed, the Weighted Composite (Cap Rate) Index™ similarly declined a modest two basis points, from 9.42 to 9.40 percent during the 3rd Quarter of 2015, with all but three of the 11 property categories recording cap rate index decreases during the quarter.

The greatest quarter-over-quarter cap rate index decrease was recorded by the Self Storage sector, down seven basis points, followed by the Industrial and lodging sector, both down four basis points during the same period.

The greatest quarter-over-quarter cap rate index increase was recorded by the Golf sector up five basis points, followed by the special Purpose sector with a gain of three basis points during the 3rd Quarter.

Mortgage terms again eased a bit overall during the 3rd Quarter, however spreads increased somewhat for all property types, while equity dividend rates were modestly lower overall.

Historical Cap Rate Indices

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