Overall sale pair dollar volume rose 150 percent year-over-year, with retail sales increasing 23 percent. The index tracks repeat sales of properties as a base. In May, CoStar recorded 829 repeat sale transactions. (You can find the methodology for CoStar's Index here).
Investment grade property sales volume also continued to rise significantly in May 2011 increasing more than 191 percent on a year-over-year basis. As a result, investment grade sales volume comprised 79. percent of total May sales volume, up substantially from 61.9 percent in April 2011.
Average deal sizes also continue to rise. According to CoStar, the average investment grade deal size in May 2011 was $33.2 million, nearly double the April 2011 average transaction size of $16.9 million. The average dollar size for the general index was $1.7 million in May 2011 as compared to the average April 2011
transaction size of $1.65 million.
What's more, only 26.7 percent of retail sales pairs recorded in May were distressed.
As a result of improving market conditions, CoStar's CCRSI Index rose 1.6 percent in May, though it is still 34.4 percent below its peak, recorded in August 2007.
The improvement in the investment sales market for commercial properties is largely due to where we are in the real estate cycle, according to Chris Macke, CoStar's senior real estate strategist. According to a presentation he gave this afternoon:
There are a number of transactions out there where people are making some great buys and people are making some great sales. Timing is just as critical as [location].