Tuesday, February 02, 2010 1:35 PM
Digested From "Cap Rates Reach 6 1/2-Year High "
Wall Street Journal (01/27/10) P. C8
The average capitalization rate for apartment communities increased to 7.36 percent in December from 7.09 percent a month earlier. According to the Journal, the cap rate is rental income in the first year of ownership divided by the purchase price. The average cap rate for office properties in central business districts rose to 8.8 percent in December from 8.56 percent in November. December's number was the highest rate for that category since May 2003.