PRESS RELEASE

CCRSI RELEASE – February 2022
(With data through January 2022)

 
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Complete CCRSI data set accompanying this release

This month's CoStar Commercial Repeat Sale Indices (CCRSI) provides the market's first look at commercial real estate pricing trends through January 2022. Based on 1,469 repeat sale pairs in January 2022 and more than 264,069 repeat sales since 1996, the CCRSI offers the broadest measure of commercial real estate repeat sales activity.

CCRSI National Results Highlights

• GROWTH OF REPEAT SALES PRICE INDICES SLOWED ENTERING THE NEW YEAR WHILE CONTINUING TO PUSH HIGHER. The value-weighted U.S. composite index, which reflects larger asset sales common in core markets, recorded slowing gains in the month of January 2022, up by 0.6% over the month compared to its 1.7% gain in December 2021, but reaching a new high of 298. The same index was up 18.1% in the 12 months that ended in January 2022 and is now 27.8% higher than in February 2020, before the onset of the COVID-19 pandemic.

• The equal-weighted U.S. composite index, which reflects the more numerous but lower-priced property sales typical of secondary and tertiary markets, advanced by a stronger 1.3% in the month of January 2022, a slowdown from its prior month’s gain of 2.0% but reaching a record high of 301. This index was up by 17.7% for the 12 months that ended in January 2022 and is 24.8% higher than its pre-COVID February 2020 value.
  

• SUB-INDICES OF THE EQUAL-WEIGHTED INDEX MOVED IN OPPOSITE DIRECTIONS FOR THE FIRST TIME SINCE JUNE 2021. The general commercial segment, which is influenced by smaller, lower-priced properties, rose by 1.3% in January 2022 and 17.0% for the 12 months that ended in January 2022. This index is 4.0% higher than its pre-pandemic level in February 2020.

• Meanwhile, the investment grade segment of the index, which is influenced by higher-value properties, edged lower by 0.2% in January 2022, its first pull back in seven months. This index is 17.7% higher than January 2021 and 7.9% higher than its February 2020 level.
  

• TRANSACTION VOLUME FELL TO ITS LOWEST LEVEL IN EIGHT MONTHS AS INVESTMENT COOLED. Composite pair volume of $13.7 billion in January 2022 was 64% lower than the blockbuster transaction volume in December 2021 and was 21% below the average monthly volume in 2021, typical of a cooling off from the end of the year frenzy. The pullback was comparable in both the investment grade segment and the commercial grade segment. Pair counts fell to their lowest level since February 2021, with both investment grade and general commercial pair counts off by more than 60%. Monthly transaction volume in January 2022 was 44% higher than in January 2021 and 31% higher than January 2020, before the onset of the pandemic.
  

• Distressed sales as a percentage of all pair counts fell to 1.2% in January 2022, its lowest level on records going back to January 2008. This was largely due to the fall in the share of investment grade distressed sales but suggests that the market may have been less liquid given the slim transaction volume overall.
  

• MARKET LIQUIDITY MEASURES SHOW THAT BUYERS AND SELLERS ARE MORE EASILY FINDING AGREEMENT. The average time on the market for for-sale properties fell by 2.4% over the 12-month period that ended in January 2022, the fifth month of declines. At 218 days, this is now at its lowest level since June of 2020. The sale-price-to-asking-price ratio edged higher to 94.7% in January 2022, its tightest since April 2006. Meanwhile, the share of properties withdrawn from the market by discouraged sellers fell by 4.4 percentage points during the 12-month period ending in January 2022, reaching a series low of 22.5%. The combination of these indicators suggest that buyers and sellers are reaching, and concluding, deals more quickly.
  
  
  

About the CoStar Commercial Repeat-Sale Indices

The CoStar Commercial Repeat-Sale Indices (CCRSI) are the most comprehensive and accurate measures of commercial real estate prices in the United States. In addition to the national Composite Index (presented in both equal-weighted and value-weighted versions), national Investment-Grade Index, and national General Commercial Index, which are reported monthly, 30 sub-indices in the CoStar index family are reported quarterly. The sub-indices include breakdowns by property sector (office, industrial, retail, multifamily, hospitality, and land), by region of the country (Northeast, South, Midwest, and West), by transaction size and quality (general commercial, investment-grade), and by market size (composite index of the prime market areas in the country).

The CoStar indices are constructed using a repeat sales methodology, widely considered the most accurate measure of price changes for real estate. This methodology measures the movement in the prices of commercial properties by collecting data on actual transaction prices. When a property is sold more than once, a sales pair is created. The prices from the first and second sales are then used to calculate price movement for the property. The aggregated price changes from all the sales pairs are used to create a price index. Historical price indices are revised as new data is recorded.

CONTACT:

Gay Beach, Senior Director of Marketing Communications, CoStar Group (gbeach@costargroup.com).

For more information about the CCRSI Indices, including the full accompanying data set and research methodology, legal notices and disclaimer, please visit:http://costargroup.com/costar-news/ccrsi.

ABOUT COSTAR GROUP, INC.

CoStar Group, Inc. (NASDAQ: CSGP) is a leading provider of online real estate marketplaces, information and analytics. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. STR provides premium data benchmarking, analytics and marketplace insights for the global hospitality industry. Ten-X provides a leading platform for conducting commercial real estate online auctions and negotiated bids. LoopNet is the most heavily trafficked commercial real estate marketplace online. Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Westside Rentals, AFTER55.com, CorporateHousing.com, ForRentUniversity.com and Apartamentos.com form the premier online apartment resource for renters seeking great apartment homes and provide property managers and owners a proven platform for marketing their properties. Homesnap is an industry-leading online and mobile software platform that provides user-friendly applications to optimize residential real estate agent workflow and reinforce the agent-client relationship. Homes.com offers real estate professionals advertising and marketing services for residential properties. Realla is the UK’s most comprehensive commercial property digital marketplace. BureauxLocaux is one of the largest specialized property portals for buying and leasing commercial real estate in France. CoStar Group’s websites attract tens of millions of unique monthly visitors. Headquartered in Washington, DC, CoStar Group maintains offices throughout the U.S., Europe, Canada and Asia. From time to time we plan to utilize our corporate website, www.costargroup.com, as a channel of distribution for material company information. For more information, visit www.costargroup.com.