Indy Metro Investment Criteria 1Q 2009
Source is Real Estate Research Corporation, respondent data.
| Indianapolis Investment Criteria | |||||||||
| Pre-Tax Yield (%) | Going-In Cap Rate (%) | Terminal Cap Rate (%) | |||||||
| RERC Estimate |
Midwest Region |
US | RERC Estimate |
Midwest Region |
US | RERC Estimate |
Midwest Region |
US | |
| CBD | 10.1 | 10.0 | 9.9 | 8.4 | 8.2 | 8.0 | 8.9 | 8.8 | 8.6 |
| Suburban | 10.7 | 10.4 | 10.3 | 8.9 | 8.5 | 8.3 | 9.3 | 9.1 | 8.9 |
| Warehouse | 9.9 | 9.8 | 9.8 | 8.5 | 8.3 | 8.1 | 8.9 | 8.9 | 8.6 |
| R&D | 10.3 | 10.2 | 10.2 | 8.7 | 8.6 | 8.3 | 9.2 | 9.2 | 8.9 |
| Flex | 10.3 | 10.1 | 10.2 | 8.8 | 8.5 | 8.4 | 9.2 | 9.1 | 8.9 |
| Regional Mall | 10.1 | 9.8 | 10.1 | 8.1 | 8.0 | 8.2 | 8.6 | 8.8 | 8.8 |
| Power Center | 10.3 | 10.0 | 10.3 | 8.6 | 8.2 | 8.3 | 9.1 | 8.9 | 8.9 |
| Neigh/Comm. | 10.1 | 10.3 | 10.4 | 8.5 | 8.5 | 8.4 | 8.9 | 9.0 | 9.0 |
| Apartment | 9.5 | 9.2 | 9.4 | 7.7 | 7.5 | 7.5 | 8.2 | 8.2 | 8.2 |
| Hotel | 12.2 | 11.8 | 11.6 | 10.0 | 9.6 | 9.4 | 10.5 | 10.2 | 10.0 |
| Average | 10.4 | 10.2 | 10.2 | 8.6 | 8.4 | 8.3 | 9.1 | 9.0 | 8.9 |
Indy Metro Transactions 1Q 2009
| Source is Real Estate Research Corporation, aggregate transaction data.Indianapolis, IN Transaction Data – 1Q 2009 – 12 Month Trailing | |||||
| < $5 million | > $5 million | All | Midwest Regional Total | National Total | |
| Office | |||||
| Volume (millions) | $6 | $135 | $141 | $6,067 | $52,458 |
| Size-Weighted Avg. ($/SF) | $56 | $123 | $117 | $140 | $233 |
| Price-Weighted Avg. ($/SF) | $71 | $130 | $127 | $196 | $479 |
| Median ($/SF) | $68 | $128 | $128 | $97 | $134 |
| Industrial | |||||
| Volume (millions) | $7 | $252 | $258 | $4,485 | $22,914 |
| Size-Weighted Avg. ($/SF) | $60 | $48 | $49 | $56 | $71 |
| Price-Weighted Avg. ($/SF) | $73 | $54 | $55 | $147 | $130 |
| Median ($/SF) | $43 | $47 | $46 | $46 | $73 |
| Retail | |||||
| Volume (millions) | $15 | $54 | $69 | $4,335 | $25,529 |
| Size-Weighted Avg. ($/SF) | $173 | $86 | $97 | $118 | $141 |
| Price-Weighted Avg. ($/SF) | $205 | $133 | $149 | $232 | $265 |
| Median ($/SF) | $199 | $153 | $199 | $92 | $121 |
| Apartment | |||||
| Volume (millions) | $10 | $177 | $187 | $3,048 | $28,816 |
| Size-Weighted Avg. ($/unit) | $26,958 | $43,844 | $42,445 | $61,412 | $89,086 |
| Price-Weighted Avg. ($/unit) | $40,384 | $47,625 | $47,244 | $109,277 | $181,791 |
| Median ($/unit) | $28,654 | $42,849 | $42,840 | $47,000 | $80,771 |
| Hotel | |||||
| Volume (millions) | - | - | - | $756 | $7,940 |
| Size-Weighted Avg. ($/unit) | - | - | - | $93,706 | $133,574 |
| Price-Weighted Avg. ($/unit) | - | - | - | $322,713 | $293,316 |
| Median ($/unit) | - | - | - | $50,000 | $72,715 |
| Source: RERC | |||||
Key Index Data
We thought a few additional economic indices might be of use, and as requested.
Key Economic Rates |
||
| 6-Month CDs | 3.13 |  |
| Moody’s Baa | 7.16 | |
| Consumer Confidence | 51.90 | |
| Sources: Federal Reserve Board, The Conference Board | ||
Selected NCREIF Returns |
||
| East Industrial Income Return | 6.39 |  |
| West Industrial Income Return | 5.55 | |
| Midwest Retail Total Return | 10.27 | |
| Source: NCREIF | ||
Selected RERC Survey Data |
||
| Nat. Neigh/Comm IRR | 8.50 | |
| Nat. Apartment IRR | 8.30 | |
| Nat. Sub Off Terminal | 7.60 | |
| Source: RERC | ||
Selected Transaction Data |
||
| Midwest Hotel W.Avg $/Unit | $122,812 | |
| Midwest Industrial W.Avg $/SF | $54 | |
| National Retail W.Avg $/SF | $153 | |
| Unemployment Rate 6.5%
|
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Indy Metro Investment Criteria 3Q 2008
|
Capitalization rates have increased, in most all asset classes, for the Indy Metro Market. We had been watching the multi-family investment criteria closely but it has also softened in the third quarter. Indianapolis |
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| 3Q 2008 | ||||||||||||
| Indianapolis Investment Criteria | ||||||||||||
| Pre-Tax Yield (%) | Going-In Cap Rate (%) | Terminal Cap Rate (%) | ||||||||||
| RERC Estimate |
Midwest Region |
US | RERC Estimate |
Indianapolis Survey |
Midwest Region |
US | RERC Estimate |
Midwest Region |
US | |||
| CBD | 9.6 | 10.2 | 9.4 | 7.7 | 9.0 | 8.1 | 7.5 | 8.4 | 8.8 | 8.2 | ||
| Suburban | 9.8 | 10.1 | 9.6 | 8.0 | 9.0 | 8.2 | 7.8 | 8.6 | 8.8 | 8.4 | ||
| Warehouse | 9.2 | 9.9 | 9.3 | 7.8 | 8.5 | 8.2 | 7.6 | 8.3 | 8.8 | 8.3 | ||
| R&D | 9.4 | 10.3 | 9.7 | 8.0 | 9.0 | 8.6 | 8.0 | 8.5 | 9.2 | 8.6 | ||
| Flex | 9.5 | 9.5 | 9.6 | 8.0 | 9.0 | 8.0 | 7.9 | 8.6 | 8.7 | 8.5 | ||
| Regional Mall | 9.0 | 9.5 | 9.1 | 7.4 | 8.0 | 7.5 | 7.3 | 8.0 | 8.2 | 8.0 | ||
| Power Center | 9.4 | 9.6 | 9.4 | 7.8 | 8.5 | 7.8 | 7.6 | 8.4 | 8.4 | 8.2 | ||
| Neigh/Comm. | 9.7 | 10.3 | 9.5 | 8.1 | 9.0 | 8.4 | 7.8 | 8.6 | 9.0 | 8.5 | ||
| Apartment | 9.0 | 9.3 | 8.8 | 7.1 | 8.0 | 7.3 | 7.0 | 7.8 | 7.9 | 7.7 | ||
| Hotel | 10.4 | 11.1 | 10.6 | 8.9 | 11.0 | 9.3 | 8.8 | 9.5 | 9.7 | 9.4 | ||
| Average | 9.5 | 10.0 | No Data | 7.9 | 8.9 | 8.1 | No Data | 8.5 | 8.8 | No Data | ||
Indy Metro Transactions 3Q 2008
| Indianapolis, IN Transaction Data – 3Q 2008 – 12 Month Trailing | |||||
| < $5 million | > $5 million | All | Midwest Regional Total | National Total | |
| Office | |||||
| Volume (millions) | $15 | $204 | $218 | $10,561 | $97,521 |
| Size-Weighted Avg. ($/SF) | $46 | $102 | $94 | $130 | $241 |
| Price-Weighted Avg. ($/SF) | $75 | $108 | $105 | $174 | $456 |
| Median ($/SF) | $84 | $128 | $97 | $107 | $151 |
| Industrial | |||||
| Volume (millions) | $4 | $187 | $191 | $5,859 | $32,117 |
| Size-Weighted Avg. ($/SF) | $41 | $41 | $41 | $52 | $71 |
| Price-Weighted Avg. ($/SF) | $43 | $44 | $44 | $133 | $126 |
| Median ($/SF) | $52 | $44 | $45 | $50 | $75 |
| Retail | |||||
| Volume (millions) | $13 | $75 | $87 | $5,728 | $33,944 |
| Size-Weighted Avg. ($/SF) | $137 | $112 | $115 | $140 | $160 |
| Price-Weighted Avg. ($/SF) | $201 | $152 | $159 | $348 | $387 |
| Median ($/SF) | $116 | $190 | $147 | $104 | $137 |
| Apartment | |||||
| Volume (millions) | - | $405 | $411 | $5,445 | $58,388 |
| Size-Weighted Avg. ($/unit) | - | $49,241 | $49,147 | $65,744 | $100,771 |
| Price-Weighted Avg. ($/unit) | - | $54,793 | $54,637 | $96,998 | $190,045 |
| Median ($/unit) | - | $42,849 | $42,849 | $49,716 | $83,925 |
| Hotel | |||||
| Volume (millions) | - | $119 | $122 | $3,265 | $33,090 |
| Size-Weighted Avg. ($/unit) | - | $151,490 | $144,848 | $143,431 | $220,033 |
| Price-Weighted Avg. ($/unit) | - | $165,603 | $162,702 | $282,148 | $629,828 |
| Median ($/unit) | - | $134,318 | $134,318 | $60,909 | $104,651 |
| Source: RERC | |||||
Indy Metro Investment Criteria 2Q 2008
Source is Real Estate Research Corporation, respondant data.
| Indianapolis | |||||||||
| 2Q 2008 | |||||||||
| Indianapolis Investment Criteria | |||||||||
| Pre-Tax Yield (%) | Going-In Cap Rate (%) | Terminal Cap Rate (%) | |||||||
| RERC Estimate |
Midwest Region |
US | RERC Estimate |
Midwest Region |
US | RERC Estimate |
Midwest Region |
US | |
| CBD | 9.3 | 9.5 | 8.8 | 7.5 | 7.9 | 7.3 | 8.3 | 8.7 | 7.9 |
| Suburban | 9.5 | 9.9 | 9.2 | 8.0 | 8.1 | 7.5 | 8.4 | 8.6 | 8.1 |
| Warehouse | 9.1 | 9.5 | 9.1 | 7.7 | 8.2 | 7.5 | 8.1 | 8.5 | 8.1 |
| R&D | 9.3 | 9.8 | 9.4 | 8.0 | 8.4 | 7.8 | 8.4 | 8.8 | 8.5 |
| Flex | 9.2 | 9.7 | 9.3 | 7.9 | 8.3 | 7.7 | 8.3 | 8.8 | 8.3 |
| Regional Mall | 8.9 | 9.2 | 8.8 | 7.2 | 7.6 | 7.2 | 7.9 | 8.4 | 7.9 |
| Power Center | 9.2 | 9.3 | 8.9 | 7.7 | 7.9 | 7.4 | 8.3 | 8.5 | 8.1 |
| Neigh/Comm. | 9.2 | 9.3 | 9.1 | 7.8 | 8.2 | 7.6 | 8.4 | 8.7 | 8.3 |
| Apartment | 8.8 | 8.7 | 8.7 | 6.9 | 7.2 | 6.8 | 7.6 | 7.9 | 7.5 |
| Hotel | 10.2 | 10.3 | 10.5 | 8.3 | 8.6 | 8.6 | 9.1 | 9.4 | 9.3 |
| Average | 9.3 | 9.5 | No Data | 7.7 | 8.0 | No Data | 8.3 | 8.6 | No Data |
Wow, look at the Apartment estimate falling both nationally and locally!
Indy Metro Transactions 2Q 2008
Source is Real Estate Research Corporation, aggregate transaction data.
| Indianapolis, IN Transaction Data – 2Q 2008 – 12 Month Trailing | |||||
| < $5 million | > $5 million | All | Midwest Regional Total | National Total | |
| Office | |||||
| Volume (millions) | $16 | $134 | $150 | $12,888 | $109,372 |
| Size-Weighted Avg. ($/SF) | $46 | $93 | $84 | $140 | $227 |
| Price-Weighted Avg. ($/SF) | $73 | $98 | $95 | $185 | $417 |
| Median ($/SF) | $67 | $85 | $82 | $102 | $145 |
| Industrial | |||||
| Volume (millions) | $6 | $97 | $103 | $6,540 | $39,252 |
| Size-Weighted Avg. ($/SF) | $35 | $39 | $39 | $54 | $71 |
| Price-Weighted Avg. ($/SF) | $39 | $45 | $44 | $131 | $129 |
| Median ($/SF) | $46 | $41 | $42 | $48 | $73 |
| Retail | |||||
| Volume (millions) | $16 | $65 | $81 | $8,349 | $46,283 |
| Size-Weighted Avg. ($/SF) | $137 | $68 | $76 | $143 | $153 |
| Price-Weighted Avg. ($/SF) | $196 | $90 | $111 | $300 | $278 |
| Median ($/SF) | $103 | $69 | $70 | $99 | $130 |
| Apartment | |||||
| Volume (millions) | - | $239 | $241 | $5,734 | $62,642 |
| Size-Weighted Avg. ($/unit) | - | $62,311 | $62,033 | $67,737 | $99,669 |
| Price-Weighted Avg. ($/unit) | - | $74,159 | $73,912 | $126,484 | $180,830 |
| Median ($/unit) | - | $71,725 | $71,725 | $44,418 | $82,876 |
| Hotel | |||||
| Volume (millions) | - | $119 | $122 | $3,751 | $38,464 |
| Size-Weighted Avg. ($/unit) | - | $151,490 | $144,848 | $122,812 | $199,059 |
| Price-Weighted Avg. ($/unit) | - | $165,603 | $162,702 | $221,055 | $558,637 |
| Median ($/unit) | - | $134,318 | $134,318 | $56,448 | $100,515 |
| Source: RERC | |||||
Indianapolis Real Estate Report
I have had repeated requests to post some data on a regular basis from our friends at Real Estate Research Corporation. You may already know that we have partnered with RERC to improve their DataCenter, it’s fulfillment, and it’s marketing efforts. The DataCenter offers paid access to an extensive library of investment criteria at a variety of custom subscription levels. You can check them out at the link in the blogroll or give us a call here for more information.
I intend to make an attempt to post updates from RERC on a quarterly basis for the Indianapolis Metro and National markets. The data will be top level indicators for the Capital Markets and a snapshot of the data available at the DataCenter. Please call me with questions or clarifications about the data.
BlogLaunch
After being asked multiple times to start a blog, we have finally decided to charge headlong into that effort. I asked an open Linkedin.com question as to what topics might be best for our blog and am currently considering the answers. Please feel free to suggest topics for discussion or updates that would be beneficial to you or your organization. I am hoping this will be a timely, interactive, and useful resource for your commercial real estate needs.
