RealtyRates.com Investor Survey Reports Minimal Cap Rate Index Contraction For Most Property Types During 4th Quarter 2014
Consistent with a nine basis point decrease in Treasury rates to which most commercial mortgage interest rates are indexed, the RealtyRates.com Weighted Composite (Cap Rate) Index similarly declined one basis point during the 4th Quarter of 2014, with all but one of the 11 property categories also recording cap rate index decreases during the quarter.
The greatest quarter-over-quarter cap rate index decrease was recorded by the Golf and Restaurant sectors, both down five basis points, followed by the Special Purpose sector, down four basis points during the same period.
The smallest quarter-over-quarter cap rate index decrease was recorded by the Healthcare/Senior Housing and Industrial sectors, both down one basis point during the 4th Quarter, while the Lodging sector was unchanged.
Mortgage terms again eased a bit overall during the 4th Quarter, spreads likewise decreased for all property types, while equity dividend rates were up somewhat overall.