MARKETTRENDS
Secondary Offi ce Market National averages
10
0 2 4 6 8
9.54% 9.53% 8.10% 8.06% 2Q12 1Q12
2.89%
3.15%
Discount rate
Overall cap rate Source: PWC Real Estate Investor Survey
Market rent change
Smaller Markets
Attract Global Cash Foreign investors plunked down $317 million for commercial real estate property in Phoenix during second quarter 2012, as well as spending $318 million in Boston and $384 million in Minneapolis, according to Jones Lang LaSalle Capital Markets Research. T ose three cities rank last in the top 10 U.S. markets for cross-border acquisitions, behind Seattle, Dallas, and Miami and the major markets. Nearly 35 percent of the total $40 billion 2Q12 deals were cross-border transactions. "Core U.S. real estate throughout primary and many secondary
cities remained very attractive to both domestic and foreign inves- tors, based on absolute initial yields on off er, and their spread over record-low Treasury rates," says Josh Gelormini, vice president of JLL's Americas Research. "T e U.S. is also benefi ting from a safe haven strat- egy, as other global markets appear on shakier ground, particularly given the ongoing Eurozone crisis."
10
0 2 4 6 8
National NNN Cap Rates Compress 2Q12
7.66 7.79 6.39 6.77 6.65 8.24 8.61 7.35 7.50 7.22 1Q12 7.35 7.35
Auto parts store
Bank Convenience store/gas station
Source: NNNetAdvisors.com 8
Discount store
Drugstore Restaurant
September | October | 2012
Commercial Investment Real Estate
Corbis/Veer