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Why it pays to think small: Data analysis debunks industry perceptions that larger, more “institutional” assets offer more safety for institutional capital
- June 1, 2024: Vol. 36, Number 6

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Why it pays to think small: Data analysis debunks industry perceptions that larger, more “institutional” assets offer more safety for institutional capital

by Ryan Swehla

In a market that has become increasingly frustrated with the dearth of transaction volume, smaller assets are proving to have an edge over their bigger peers when it comes to liquidity. A recent Green Street report profiled that smaller asset sales proved more liquid than larger asset sales in 2023, as well as in prior downturns. This mirrored Graceada Partners’ disposition and acquisition experience, so we conducted an analysis of CoStar sales data in the Western United States. The data set looked at transaction volume for smaller assets between $1 million and $40 million versus larger assets $40 million-plus during the 18-year period from first quarter 2006 through first quarter 2024. The results demonstrate greater liquidity in smaller asset sales across metrics that include:

Average annual transaction volume Volatility in transaction volume Peak to trough percentage decline

Smaller assets generate better deal velocity

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