First REITs stumbled, now the major commercial brokerages seem to be following.
The stocks of CBRE and JLL and other major commercial firms are down significantly this month, with the giants losing 8 percent and 8.7 percent of their values, respectively. In addition, Marcus & Millichap stock was down 10 percent, with HFF down a whopping 17 percent.The losses follow a period in which commercial property firms’ stocks outperformed comparable investments in REITs and the SNP 500. Until this month, CBRE was up 11 percent for year, and JLL was up 19 percent, Bloomberg reported.
The disappointing performance suggests the booming growth in commercial property transactions may be “in the rear-view mirror at this point,” Brad Burke, an analyst at Goldman Sachs, told Bloomberg, “This is a natural maturing of the real estate cycle.”
The ratings reductions follow similar expectation adjustments for major REITs. A number of the biggest REITs, including SL Green Realty and Vornado Realty Trust, were downgraded by financial service firms in the last few weeks. [Bloomberg] – Ariel Stulberg