Insights from Altus Group's First U.S. Investment Quarterly Report
Altus Group (TSX: AIF), renowned for its expertise in asset and fund intelligence within the commercial real estate( CRE) sector, has rolled out its very first U.S. Investment & Transactions Quarterly Report. This report, which looks back on transaction data from Q3 2024, marks a significant step in the comprehensive examination of U.S. commercial real estate activity.
Understanding the Market Trends
This inaugural report is unique in its approach, analyzing transaction data in a way that encompasses a wide spectrum of market activities. Unlike many industry reports that focus solely on larger transactions, Altus Group provides a nuanced view, capturing essential single-asset transactions that exceed $100,000 in sale value. This means stakeholders gain valuable insights into various property sectors beyond just high-profile deals.
The Figures Behind the Report
The data reveals that the U.S. commercial real estate market witnessed a total transaction value of around $40.1 billion in Q3 2024. This figure demonstrates a decline from previous quarters: $43 billion in Q2 2024 and $44.4 billion in Q3 2023. This downturn suggests a continuing trend associated with key metrics outlined in the report.
Key Metrics Overview
The report provides an in-depth look at key performance indicators, which include:
- Count of Properties Transacted: Decreased by 10% from Q2 2024 and 9.9% compared to Q3 2023.
- Dollars Transacted: Down 6.6% from the previous quarter and 9.6% year-over-year.
- Square Feet Transacted: Declined by 3.8% sequentially and 11.4% year-on-year.
Market Recovery Indicators
Despite the decline, Cole Perry, Associate Director of Research at Altus Group, offered insights suggesting that the rate of decrease may be slowing, reflecting a more positive financing environment and rising market optimism. In fact, certain property sectors exhibited resilience, with 10 out of 15 sub-sectors showcasing positive price growth per square foot.
An Overview of Key Highlights
As detailed in the report, several interesting highlights have emerged from the Q3 2024 activity:
- Transaction numbers for multifamily properties saw a decrease of 11%, with industrial properties down 6%. Office and retail sectors displayed declines of 15% and 9%, respectively.
- Year-to-date cumulative volumes reflect concerning trends; the number of properties transacted is at a low not seen since 2011, while total transaction dollar volume represents the lowest since 2013.
- Although the daily averages for count, dollar volume, and square footage have hovered around pandemic-era lows for most property types, each sector has shown an increase in average square footage per transaction for Q3 2024.
- Interestingly, the average price per square foot across all transacted properties increased by 1.2% since the last quarter, with the exception of hospitality properties, which experienced a decline of 2.6%.
- The multifamily sector emerged as a leader in dollar volume, contributing $12.2 billion to the total transacted, closely followed by industrial, office, and retail sectors.
About Altus Group
Headquartered in Toronto, Altus Group is a premier provider of asset and fund intelligence demanded by players in the commercial real estate industry. The firm's innovative technology and advisory services greatly assist investors and stakeholders in managing risks and enhancing their investment returns across different phases of assets and funds. Spanning across North America, EMEA, and Asia Pacific, Altus Group employs approximately 2,900 talented professionals dedicated to delivering insights to its global clientele.
Connecting with Altus Group
For those interested in a deeper dive into the findings of the Q3 2024 report, please reach out via the details provided below:
Contact Information:
Elizabeth Lambe
Director, Global Communications, Altus Group
(416) 641-9787
elizabeth.lambe@altusgroup.com
Frequently Asked Questions
What is Altus Group's focus?
Altus Group specializes in providing asset and fund intelligence, tailoring its services for the commercial real estate industry.
How does this report differ from others?
The report delivers a broader analysis of transaction activities, including smaller single-asset deals, unlike many reports focusing exclusively on large transactions.
What were the total transactions in Q3 2024?
In Q3 2024, the U.S. commercial real estate market recorded transaction values amounting to $40.1 billion.
What does the report say about market trends?
It indicates a slight decline in transaction activity yet suggests a potential improvement in the financing landscape.
How can I access the full report?
For comprehensive insights, Altus Group provides access to their reports through their main website and communication channels.
