More Product In Single Tenant, Net Lease Retail Market

Posted September 19, 2013

In Commercial, investing, net lease, nnn, real estate, Retail

With 10 year treasuries at just under 3%, we’ve seen about a 100 bp rise in rates over the last couple of months. Is this finally affecting the super hot, investment grade, single tenant, net leased retail market? I’m seeing more triple net, single tenant product on the market over the last month or so, but still at asking cap rates lower than could be expected given where interest rates are at the moment.

I think we’ll see a rebalancing through the end of the year with cap rising maybe as much as 50 basis points. Asking caps will stay pretty much where they are for the foreseeable future, but single tenant net lease product will stay on the market longer until seller and buyer expectations rebalance as the long term expectation for higher rates increase. And this is in spite of the announcement yesterday that the Fed will continue to pump in the short term.

Nothing really new or shocking here as we hit the midpoint in the current boom cycle. After multifamily, investment grade, single tenant, triple net retail recovered next so it will see the next downturn sooner than office or industrial.

Commercial Real Estate, NNN Property, Triple Net Retail

Commercial realtor

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