Austin Commercial Real Estate cap rate survey as of the mid year 2014 was recently made available by CBRE. Click here for report.
For those not familiar with cap or capitalization rate it is a way to measure the rate of return on real estate investment property based upon projected income. This is calculated by dividing the net operating income (gross income less costs) by the total value of the property or mathematically Capitalization Rate = Yearly Income divided by Total Value.
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Central Business District Office Buildings Stabilized Cap Rates
- Class A ranges from 5 to 5.25%.
- Class B ranges from 6.5 to 7%.
- Class C ranges from 8 to 8.5%.
Suburban Office Buildings Stabilized Cap Rates
- Class A ranges from 5.5 to 6%.
- Class B ranges from 6.5 to 7%.
- Class C ranges from 8 to 8.50%.
Retail Neighborhood / Community Center (Grocery Anchored)
- Class A ranges from 5 to 5.5%.
- Class B ranges from 7 to 7.75%
- Class C ranges from 9.25 to 9.75%
Retail Power Center
- Class A ranges from 6.25 to 6.75%
- Class B ranges from 7.25 to 8 %
- Class C ranges from 9.25 to 9.75%
Industrial
- Class A ranges from 6 to 6.5%
- Class B ranges from 6.75 to 7.25%
- Class C ranges from 8.5 to 9%
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