Cap Rates Decline Amid Slow Commercial Real Estate Recovery

By Carisa Chappell

High demand from investors and low interest rates continue to push down capitalization (cap) rates in the commercial real estate market, according to an analysis from consulting firm PwC.

The report noted that in the second quarter of 2013, the combined overall cap rate fell to 6.91 percent across the 34 United States markets included in the survey conducted by PwC. It marked the 12th consecutive quarter that cap rates have fallen and represented the largest quarterly decline since the end of 2010. The average cap rate during the first quarter of 2013 was 7.08 percent. Read more…

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