- Total sales volume of $47.2 billion was up 14% compared with August 2019 levels.
- Office continued to recover with $10.2 billion in volume, including more frequent larger deals.
- Multifamily led all asset classes in monthly volume ($18.5 billion) and has captured four of every 10 dollars invested this year.
- Retail and hotel sales growth remains uneven. Hotel investors are targeting newer assets, likely to avoid extra capital spending on deferred maintenance.
Some of the year’s largest deals took place in August, when volume of $10.2 billion was in line with August 2019 figures. The return of higher-priced single-asset sales is a promising development. In the largest deal of the month, a joint venture of MetLife and NBIM purchased One Memorial in Cambridge, MA, for $825.1 million, with the price per square foot of $2,015, the highest ever for an office building in the Boston market. Viacom/CBS agreed to a short-term sale-leaseback of 51 W 52nd Street in New York to Harbor Group International, for approximately $760 million. The deal is pending and will drive volume in the months ahead.
Industrial sales volume remains on a tear, totaling $10 billion. Oxford Properties made a splash in August, buying a 149-property portfolio of infill and light industrial properties totaling 14.5 million square feet across the country. The portfolio, at $2.2 billion, is the largest industrial deal of the year. The deal is still pending and is not included in the August stats. Meanwhile, in a JV with Ivanhoe Cambridge, Oxford sold a five-property 3.2-million-square-foot portfolio to GCP Capital Group in a JV with the state of Utah for $353.4 million. In Atlanta, Goldman Sachs acquired two food distribution centers totaling 1.4 million square feet, for $195 million.
Strong investor interest in multifamily pushed August volume to $18.5 billion, 9% above August 2019 figures. The largest deal of the month was the JV of Blackstone, TruAmerica Multifamily, and Guardian Life Insurance for a 5,800-unit portfolio in San Diego, CA, for $1.5 billion. California, a popular investment target in August, had several of the largest deals of the month, and investors also focused on other Western states (Washington, Nevada). The recently built The Residences Uptown Boca in Boca Raton, FL, also traded to Cortland for $230 million for 456 units at $504,386/unit.
Retail volume of $6.8 billion was 62% above August 2019 totals. Limited high-dollar transactions are weighing on volume, along with a lack of entity-level transactions. Despite that, retail posted the strongest volume growth of all asset types compared to August 2019. Similar to multifamily sales, the largest retail transactions were also focused in California, with the largest deal of the month the $185 million sale of The Forum Carlsbad to Northwood Investors. The property traded for $700 per square foot, and previously sold in September 2011 for $180 million. Other leading deals were in Los Angeles, Mountain View, Novato, and Glendale.
There were no entity-level deals in August, which limited hotel sales volume. A total of $1.7 billion traded in the month, 46% lower than August 2019 figures. The largest was the sale of the Hotel Washington (326 rooms renovated in 2019) in Washington, D.C., for $220 million. Investors targeted newer properties in August, and several had been built since 2018. For example, three AC Hotels, in Portland, ME (2018 built, $66.8 million), Phoenix, AZ (2020 built, $65 million), and Santa Rosa (2019/2020 built, $56.5 million) sold in separate transactions.