Data from commercial real estate firm Calkain Companies confirms that the demand for net lease assets remains strong. Transaction volume for these properties increased 15 percent. Retail net lease cap rates have compressed to below 7 percent.
“Net leases remain highly popular in 2014, averaging the lowest cap rates in the past three years despite interest rate increases over the same period,” Winston Orzechowski, research director with Calkain and co-author of its Net Lease Economic Report. “Institutional investors are increasing their exposure as net leases become a significant part of general commercial real estate portfolios.”