Office Cap Rates In May 2009
The highest office cap rates, averaging 8.0%, were registered in the Midwest, followed by the Southwest, where office cap rates averaged 7.7%. The lowest rates were registered in the West, where office cap rates in May 2009 averaged 6.8%. Second lowest office cap rates were registered in the Northeast, where they averaged 6.9%. Office cap rates in May 2009 in the Mid-Atlantic and Southwest averaged 7.2% in both regions.
NAR/TWR actually predict that the worsening of the office market will continue through 2010, with the vacancy rate shooting above 20% and over 110 million square feet of negative absorption. In May 2009, there were also significant variations in average office property prices across US regions, according to data regarding transaction prices provided also by RCA. In particular, the highest by far office property prices were recorded in the Northeast where they averaged $476 per square foot. The lowest office property prices were recorded in the Midwest and Southwest, where they averaged $145 per square foot and $175 per square foot, respectively. Office property prices in the West averaged $265 per square foot
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