US industrial capitalization rates for transactions of $5 million or more, registered a year-over-year increase of 80 basis points in Q2 2009, according to data provided by Real Capital Analytics (RCA) and published by Mortgage Bankers Association (MBA).
In particular, the average industrial cap rate in the US increased from 7.3% in the second quarter of 2008 to 8.1% in the second quarter of 2009.
It should be noted though that on a quarter-to-quarter basis, the average US industrial cap rate involving transactions of $5 million or more compressed 20 basis points as the average reported for the first quarter of 2009 is 8.3%.
The highest industrial cap rate reported over the period Q1 2004 to Q2 2009, which is the time span covered by the data published by MBA, is 8.4% and was recorded in the first two quarters of 2004.
Since then, quarterly industrial capitalization rates for transactions of $5 million or more have been mostly decreasing until Q2 2007 when they bottomed at 6.8%, representing an 160 basis point drop. Since then, US industrial cap rates have been consistently increasing with the exception of Q2 2009.
Since Q1 2005, the largest year-over-year drop in industrial cap rates was 120 basis points and was registered in Q1 2006, while the largest year-over-year increase was 100 basis points and was posted in Q1 2009.
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Return from US Industrial Capitalization Rates Q2 2009 to Market Watch
