PRESS RELEASE

CCRSI RELEASE – September 2018
(With data through August 2018)

 
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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 October 2018. Based on 1,247 repeat sale pairs in October 2018 and more than 200,000 repeat sales since 1996, the CCRSI offers the broadest measure of commercial real estate repeat sales activity.

CCRSI National Results Highlights

• COMPOSITE PRICE INDICES POSTED MODERATE ANNUAL GAINS, DESPITE RELATIVELY FLAT PERFORMANCE IN OCTOBER. While the pace of growth has slowed as the cycle matures, composite price indices continued to make steady gains on an annualized basis. The value-weighted U.S. Composite Index, which reflects larger asset sales common in core markets, dipped by a slight 0.1% in October 2018, although it was still up 3.4% for the 12-month period ended in October 2018. The equal-weighted U.S. Composite Index, which reflects the more-numerous but lower-priced property sales typical of secondary and tertiary markets, dipped by 0.3% in October 2018, while posting an annual gain of 7.0% in the 12-month period ended in October 2018.

• RECENT PRICING TRENDS MIRRORED IN BOTH SUB-INDICES OF THE EQUAL-WEIGHTED COMPOSITE INDEX. The Investment-Grade segment of the equal-weighted Composite Index, which is influenced by higher-value properties, increased 0.5% in October 2018, contributing to an annual gain of 10.3% in the segment for the 12-month period ended in October 2018. Meanwhile, the General Commercial segment of the index, which is influenced by smaller, lower-priced properties, retrenched by 0.6% in October 2018, although it posted an annual gain of 6.4% in the 12-month period ended in October 2018.

• TRANSACTION VOLUME REMAINED BRISK. Despite the relatively flat pricing growth performance in October 2018, overall sales volume remained robust. Composite pair volume rose 4.6% for 12-month period ended in October 2018. On a year-to-date basis, composite pair volume topped $112.6 billion, which is the highest January-to-October sales volume total on record for the CCRSI. The increase in pair volume was felt more strongly in the General Commercial segment, where transaction volume rose 12.8% year-to-date through October 2018, to $33.1 billion. Meanwhile composite pair volume was up by 4.2% to reach $79.5 billion in the Investment-Grade segment during the same time period.

• MARKET LIQUIDITY MEASURES CONTINUED TO IMPROVE. The average time on the market for for-sale properties decreased 7.5% in the 12-month period ended in October 2018, to 205 days, the lowest it has been since 2006. Meanwhile, the sale-price-to-asking-price ratio, which measures the spread between buyer and seller expectations, narrowed by 0.9 percentage points over the past 12 months to 92.9% in October 2018. The share of properties withdrawn from the market by discouraged sellers also receded by two percentage points to 26.3% in the 12-month period ended in October 2018.

About The CoStar Commercial Repeat-Sale Indices

The CoStar Commercial Repeat-Sale Indices (CCRSI) is the most comprehensive and accurate measure 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 we report monthly, we report quarterly on 30 sub-indices in the CoStar index family. 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 of the sales pairs are used to create a price index.

Contact:

Richard Simonelli, Vice President, Vice President Investor Relations; (202) 346-6394  (rsimonelli@costar.com).

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

ABOUT COSTAR GROUP, INC.

CoStar Group, Inc. (NASDAQ: CSGP) is the leading provider of commercial real estate information, analytics and online marketplaces. 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. LoopNet is the most heavily trafficked commercial real estate marketplace online with approximately 5 million monthly unique visitors per month. Realla is the UK's most comprehensive commercial property digital marketplace. 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. CoStar Group's websites attracted an average of approximately 45 million unique monthly visitors in aggregate in the third quarter of 2018. Headquartered in Washington, DC, CoStar maintains offices throughout the U.S. and in Europe and Canada with a staff of over 3,600 worldwide, including the industry's largest professional research organization. For more information, visit www.costargroup.com.