The quarterly total return for the NCREIF Property Index (NPI) was 6.15 percent for fourth quarter 2021, which consisted of 1.03 percent from income and 5.12 percent of appreciation. This was the highest appreciation in the history of the NPI, which began in first quarter 1978. Appreciation is after the deduction of capital expenditures. Market values before considering capital expenditures also increased at a record level of 5.40 percent.

The 6.15 percent return is the unleveraged returns for what is primarily “core” real estate held by institutional investors throughout the United States. Properties with debt financing had a leveraged total quarterly return of 8.05 percent. As of quarter-end, there were 4,399 properties with leverage, and the weighted average loan-to-value ratio was 44 percent.

The story continues to be the exceptionally strong performance of the industrial (primarily warehouse) sector. The industrial total return for the fourth quarter was 13.34