Capitalization Rate Studies

Capitalization rate research, analysis and studies are useful in developing market-supported cap rate conclusions for commercial real property valuations for various purposes, including financing, acquisition and disposition, assessments, and litigation.  Part of the methodology involves updating cap rates from dated sales in markets where comparable sales are limited. This technique has been successfully used in numerous assignments.

Korpacz Realty Advisors, Inc. (KRA) developed and continues to refine the market-supported cap rate methodology that advances the state-of-the art of cap rate studies in industry practice.  As a thought leader in this appraisal and consulting product type, KRA has accomplished the following.

  • Developed the methodology and provided cap rate studies for specific properties in the 1990s for The Rouse Company and The Taubman Company
  • Successfully implemented this market-derived methodology for 140+ office and industrial properties in the San Francisco Bay Area for 2002-2003 assessment litigation for Equity Office Properties
  • Employed the methodology in Boston in a consulting assignment to test the likelihood of contesting assessments on numerous Class A office buildings
  • Conducted regional mall cap rate studies for the following clients
    • CBL Associates
    • Forest City
    • General Growth Properties
    • Macerich
    • Simon Property Group, Inc.
    • The Taubman Company
    • Urban Retail Properties
  • Employed the methodology in tax appeals for individual real estate assets or entire markets for
    • Multifamily and office properties for the City of Alexandria and Arlington County, VA
    • Retail, multifamily, and office properties for Fairfax County, VA
    • Land value trends for multiple property types in Stafford County, VA
    • Condemnation valuations for the Virginia Department of Transportation (VDOT)
    • Assessment appeal valuations involving offices, regional malls, and development land in Fairfax County, VA
  • Employed the methodology in a real estate valuation methodology study for chain drug store properties in Hillsborough County (Tampa), FL