July’s sales activity remained relatively stable, but the topline tells only part of the story, with varied sector-level performance and continued pressure on pricing.
- Traditional-sector activity was essentially unchanged from a year earlier, with July volume totaling $36.3 billion, down 1% year over year.
- Office and hospitality posted the strongest growth among traditional sectors; apartment and retail volume declined, while industrial was essentially flat.
- Pricing was broadly flat, with the RCA CPPI All-Property Index up 0.2% year over year.
Office
Office stood out as one of the few sectors to post meaningful growth in July. Sales totaled $7.6 billion, up 31% year over year, with CBD volume rising 46% and suburban volume increasing 26%. The CBD gain was driven by individual asset sales, which more than doubled, while suburban volume was boosted by portfolio activity, including medical office portfolios. Pricing trends were also more constructive, with CBD cap rates edging down 10 basis points to 7.1%.
Industrial
Industrial investment was effectively flat in July, with volume totaling $9 billion. Portfolio and entity activity rose 9%, offsetting a 4% decline in single-asset sales. Warehouse volume slipped 1%, while flex sales increased 5%. Within warehouse, portfolio sales rose while individual warehouse trades declined. The reverse was true for flex. Cap rates continued to move higher, with the trailing 12-month average rising to 6.6% from 6.3% a year earlier.
Multifamily
Multifamily remained the largest traditional sector by volume, but activity softened. Apartment sales totaled $12.4 billion, down 16% year over year, as individual asset sales fell 25%. Portfolio and entity activity rose 21%, driven mainly by one large California portfolio. Excluding that transaction, mid- and high-rise portfolio volume would have declined. Pricing remained under pressure, with the apartment CPPI down 4.1% year over year.
Steig Seaward
Stronger transaction activity did not always translate into stronger pricing, with cap rates continuing to move higher across several sectors.
Retail
Retail volume fell 13% year over year to $4.7 billion, as portfolio and entity sales pulled back sharply. Single-asset activity was nearly flat, down 1%, but performance varied by subtype: shopping center sales generally help up better, while stop-space activity was softer.Cap rates ticked higher, and the retail CPPI declined 0.9%.
Hospitality
Hotel investment was a bright spot, with July volume up 61% year over year to $2.5 billion. Full-service hotels led the gains, supported by a surge in portfolio sales and stronger activity across individual assets. Limited-service volume also increased, with growth concentrated in portfolio sales. Despite stronger activity, pricing remained challenged, with the hotel CPPI down 8.6% and trailing 12-month cap rates rising to 8.3%.
