According to CBRE, signed confidentiality agreements in July were down only 17% from July, 2019. Interested CRE buyers are required to sign a confidentiality agreement (CA) before receiving detailed marketing materials. July's performance is a stark improvement over April & May's 75% decline in buyer interest.
Notably, confidentiality agreements signed in Q2 for industrial and multifamily properties reached 46% and 42% of the last two years’ average Q2 levels. The industrial and multifamily progress surpassed confidentiality agreements signed for retail (37%), hotels (35%) and office (32%) properties.
However, while some CRE transactions are beginning to recover, many property investors are requesting and obtaining price reductions. Property values are expected to decline 10% to 20% by year’s end, which will cause a moderate rise in cap rates, CBRE wrote. But July sales also indicate cap rates of Class-A industrial and multifamily assets were more stable in Q2 compared to other asset types.