Colliers Insight
Aaron Jodka
“January MSCI Update – Retail dominates with a 116% volume surge.”

Office volume may be finding a bottom, at least when looking at year-over-year changes. With $2.9 billion trading in January, volume was off 15% from last year. This trend follows a December where volume was down 6%, a substantial improvement from the rates seen earlier in 2023.

The largest transaction of the month was Boston Properties’ partner buyout of 901 New York Avenue Northwest in Washington, D.C.

Similar to office, year-over-year volume comparisons show signs of a market turn. Volume was down 13% from last January, following three prior months of lower levels of decline. Activity remains muted, with $4.9 billion trading.

Nestlé acquired two assets in Fairburn, GA, which they occupy, for $108 million, marking the largest reported sale of the month.

Multifamily saw $4.5 billion of volume in January, a 45% decline from last year. With fundamentals softening in many markets, volume has yet to find much traction.

The exception is San Francisco, which has seen increasing volume for three consecutive years. The largest deal of the month was a 2,151-unit portfolio in San Francisco, which traded to Brookfield Asset Management and Ballast Investments for $464 million.

Retail volume led all asset classes in January, driven by the sale of Spirit Realty Capital to Realty Income Corp. This, along with individual asset sales, caused volume to soar 116% from last January to $7.9 billion.

The largest individual trade was Kering SA’s acquisition of 715-717 Fifth Avenue in Manhattan for $963 million. This sale continues the trend of large luxury brands acquiring retail space in Manhattan. 

Hospitality volume remains subdued, with $880 million trading in January, a 51% decline from last year. Historically, this asset class has shown more monthly volatility than others.  

The largest reported deal of the month was the 224-room Red Lion Hotel & Conference Center in Renton, WA. King County acquired the currently vacant property, previously used as emergency housing.