How Well Have the Values Held?

I'm glad you asked. A week ago, I decided it might be interesting to look at the most recent crop of commercial sales and compare their most recent sales price to their last sales price - assuming they had one. The results were enlightening:

This graph illustrates the Sale Price in Q2, 2011 as a percentage of a properties last sales price, organizing it by the year of the last sale.

My Take Aways ...

Properties that sold pre-boom (i.e. 2000-2003) are now selling for about 70% of their last sales price.

Properties that sold during the boom (2004-2007) are now selling for about 45% of their last sales price.

Properties that sold post-boom (2008-2010) are now selling for about 65% of their last sales price. This suggests that properties purchased in 2008 (50% rate of return) and 2009 (65% raste of return) were still over-priced. Those few brave investors who entered the market then did not appreciate the scale of the slow-down.

Properties that sold in Q1-11 sold in Q2-11 for 143% of their last sales price. This suggests that prices hit bottom sometime in late 2010/early 2011.

Among property types, Industrial seems to have held its value better than office or retail. Industrial properties had an average rate of return of 70%, compared to 54% for retail and 49% for office.

Owner-user properties have sold, on average, for 63% of their last sales price, compared to 53% for investment properties.
Henderson properties have sold, on average, for 60% of their last sales price, compared to 59% for Las Vegas and 54% for North Las Vegas.

In terms of Q1 to Q2 property flips, the highest returns have been on investment properties (169%) and office properties (153%), and lowest on properties in North Las Vegas (54%). All categories other than "North Las Vegas" had a positive return.

When did each category show its lowest rate of return? For Industrial it was 2008, Office 2006, Retail 2006, Owner-User 2007, Investment 2006, Henderson 2006, Las Vegas 2006 and North Las Vegas 2010.