- October 04, 2017
Net Lease Cap Rates Trend Lower
Single-tenant net lease cap rates in the third quarter of 2017 decreased across all asset classes when compared to the previous quarter. Cap rates for retail properties decreased by 12 basis points to 6.11 percent, representing the lowest level in the net lease retail sector since the third quarter of 2016, when cap rates were at a historical low of 6.10 percent. Cap rates for net lease office and industrial properties decreased by 16 and 10 basis points to 6.98 percent and 7.27 percent, respectively.
- September 05, 2017
QSR Sector Grows More Appealing
E-commerce may have hit many retailers hard, but some, at least from an investment standpoint, have seen benefits. Investors keep gravitating towards the quick service restaurant sector, pushing its median cap rate below other kinds of retail outlets. In the second quarter of 2017, the rate fell to just 5.56%, a 14 bp decline when compared to the prior year, according to a new study by the Boulder Group, a net lease firm in Northbrook, IL. Corporate leased QSR properties were more popular. Cap rates for that subsector decreased by 10 bps to 5.35% while franchise properties declined by 5 bps to 5.75% cap rate.
- August 23, 2017
Triple Net Lease Buyers Are Willing to Pay Premiums for New Construction. But Is It a Smart Move?
A growing number of 1031 exchange buyers are paying a premium to buy newly constructed triple net lease retail and restaurant locations. But some of those investors may be in for a rude awakening when it comes time to calculate returns on an exit strategy.
- August 03, 2017
More than 200 attend REJournals’ third annual Net Lease Summit
The biggest names in the net-lease industry gathered in Chicago late last month for REJournals’ third annual Net Lease Summit. More than 200 industry professionals gathered at the University Club to discuss the net-lease, sale leaseback and 1031 Exchange markets. Those filling the club heard plenty of good news about the future of these markets. The net-lease industry is on the rise, with the number of both sales and leases on the rise.
- August 02, 2017
Net Lease Dollar Store Supply Increasing
Cap rates within the single-tenant net lease dollar store sector increased by 10 basis points from the second quarter of 2016 to the second quarter of 2017 to a 6.75 percent cap rate. The dollar store sector, for the purpose of this report, is defined as free standing Dollar General, Dollar Tree and Family Dollar properties, as these tenants represent the largest presence within the sector. Cap rates for Dollar Tree assets compressed by 10 basis points while Dollar General and Family Dollar experienced increases of 15 basis and 20 basis points, respectively.
- July 17, 2017
Net Lease Sector Heats Up; Experts Expect “Frothy” End to 2017
At the mid-point of 2017, net lease investments continue to be a strong sector in commercial real estate, a sector that experts say has become its own distinct investment class. This strength is evidenced, in part, by commercial real estate conferences across the country that are devoted exclusively to issues and topics associated with the sector. Later this month, on Wednesday, July 26, Midwest Real Estate News will host a full day conference in Chicago. It will bring together many of the newsmakers in this segment of the business.
- July 05, 2017
Net Lease Market Shifts to Neutral
Cap rates in the second quarter of 2017 in the single-tenant net lease sector increased across all asset classes when compared to the previous quarter. Cap rates for retail and office properties increased slightly by three and two basis points to 6.23 percent and 7.14 percent, respectively. Cap rates for net lease industrial properties increased by 10 basis points to 7.37 percent.
- July 03, 2017
Net Lease Cap Rates Beginning To Rise
Cap rates in the single tenant net lease market have been on a long-term slide that eventually reached historic lows, but that era may be over. A boost had been expected, and in the second quarter, rates increased across all asset classes when compared to the previous quarter, according to a new report from the Boulder Group, a net lease firm in suburban Chicago.
- June 23, 2017
Rate Hikes Did Not Impact Net Lease Activity In Q1: Here Are 3 Things To Note
Although the market is strong, net lease asset investors are cautious about the effect of rising interest rates on cap rate volatility. The Federal Reserve raised short-term interest rates for the fourth time in six months in June, boosting their benchmark rate to between 1% and 1.25%. That movement could impact deal volume and asset valuations, though the 10-year Treasury remains at historic lows.
- June 14, 2017
Restaurant Boom Feeds 1031 Investment Pipeline
Investors using 1031 exchanges continue to have a voracious appetite for triple net lease properties, and they are increasingly setting their sights on restaurants. “People are shifting to e-commerce-resistant retail, and restaurants are at the top of the list of what people are looking for,” says Randy Blankstein, president of the Boulder Group, a net lease advisory firm. “So it has gone from a category that five years ago was considered specialty to very much a mainstream category that is getting a lot of interest from a lot of new players.”
- June 07, 2017
Net Lease Casual Dining in Demand with 1031 Buyers
Cap rates in the net lease casual dining restaurant sector increased 25 basis points (bps) to 6.00 percent in the first quarter of 2017, when compared to the first quarter of 2016. Casual dining restaurant properties with corporately guaranteed leases had cap rates of 5.75 percent, while franchisee-leased properties were priced 50 bps higher at 6.25 percent. Cap rates for casual dining restaurant properties leased to franchisees will vary depending on the strength of the operator. In the first quarter of 2017, franchisee-backed casual dining restaurants accounted for 49 percent of the overall supply of casual dining restaurants.
- May 26, 2017
Sales Volume on Net Lease Assets Roughly Flat with Last Year’s
It seems there’s no investment sector safe from the current political uncertainty, including net lease assets. Investment sales volume in the sector in 2017 will likely end up flat with 2016 levels, industry sources say.
- May 18, 2017
Cap Rates Head Up For Casual Dining Sector
Cap rates in the net lease casual dining restaurant sector increased 25 bps points to 6.0% in the first quarter of 2017 when compared to the first quarter of 2016, according to a new report from the Boulder Group, a net lease firm based in Northbrook, IL. These tenants have become more popular with retail operators in the past few years because, unlike many outlets, they can’t be harmed by e-commerce. But an increase in the number of franchisee-backed restaurants helped push up cap rates.
- May 11, 2017
Nothing But Net
As the net lease sector continues to take on its own asset class presence, investors and lenders are increasingly putting their capital into the property type, especially single-tenant, triple-net leased properties. Net lease owners with investment-grade tenants in place are most attractive to investors, but a lack of available inventory is leading some lenders to widen their options.
- May 09, 2017
Investors are eager to sell freestanding properties as they perceive a market peak
- May 03, 2017
Banks Remain Top Target For Net Lease Investors
As recently reported in GlobeSt.com, the retail side of banking is undergoing a profound change as customers adopt the use of mobile apps. Banks don’t need as many branch locations and many have begun to also shrink the footprint of their remaining outlets. But investors, attracted by the superb credit rating of many banks, still have an appetite for these properties, according to a new report from the Boulder Group, a net lease firm in suburban Chicago.
- April 13, 2017
As Some Retailers Stumble, Dollar Stores Continue to Show Strength
The dollar store segment is benefitting from current trends in the big-box retail space and national economy, taking this time to expand current store models while experimenting with smaller spaces geared toward customer’s convenience.
- April 05, 2017
Net Lease Cap Rates Stable in Q1
Cap rates in the first quarter of 2017 for the single-tenant net lease retail sector remained at 6.19 percent after experiencing their first increase since the third quarter of 2013 in the prior quarter. Cap rates for the office and industrial sectors increased by 4 basis points and 10 basis points, to 7.12 percent and 7.27 percent, respectively. Following a robust 2015 with more than $58 billion in net lease sales, 2016 experienced a slight decline in transaction volume of approximately 7 percent to approximately $54 billion, according to CoStar. The slowdown in 2016 transaction volume can be mostly attributed to the uncertainty surrounding rising interest rates and the future results of the 2016 election.
- March 15, 2017
Randy Blankstein to chair Net Lease Summit Conference
Randy Blankstein, founder and president of The Boulder Group, will be the conference chair of the Midwest Real Estate News 3rd Annual Lease Summit Conference in Chicago on July 26.
- March 01, 2017
Net Lease Auto Parts Sector Outpaces Market
Cap rates for the single-tenant, net-leased auto parts store sector decreased by 8 basis points from the fourth quarter of 2015 to the fourth quarter of 2016 to 5.9 percent. The decline in cap rates for the auto parts store sector slightly outpaced the overall net lease retail market, which compressed by 6 basis points over the same time period. The auto parts sector, for the purpose of this report, is defined as Advance Auto Parts, AutoZone and O’Reilly Auto Parts, as they account for the highest percentage of single-tenant transactions of properties occupied by auto parts retailers.
- February 16, 2017
What Will Rite Aid Divestitures Mean for Net Lease Investors?
When a retailer announces that it will sell off about 1,200 stores in order to take its business to the next level, these days the assumption is that the company is struggling to stay afloat and needs to quickly shed excess weight and curb costs.
- February 02, 2017
Big Box Retail Sees Jump In Cap Rates
The decision by Macy’s, The Limited, and other retailers to close outlets around the US has shaken up the world of retail. And with some experts predicting that many more outlets will close this year, investors are definitely taking notice.
- February 01, 2017
Rising Interest Rates Likely to Cool Net Lease Prices
Buyers vying for net lease investment properties have been paying top dollar to win deals. But an increase in interest rates is already causing cap rates to creep higher and there could be more price adjustments ahead for 2017.
- January 18, 2017
Net Lease Cap Rates Change Direction
Cap rates in the fourth quarter of 2016 for the single-tenant net lease sector increased or remained the same for all three asset classes: retail, office and industrial. Retail cap rates experienced their first increase since the third quarter of 2013 to 6.19 percent cap rate. The 9-basis-point increase is the largest increase in retail cap rates since the second quarter of 2011. Cap rates for the office sector remained unchanged at 7.08 percent, while industrial sector cap rates increased by 3 basis points to 7.17 percent.
- January 06, 2017
The coffee wars are on: Dunkin’ Donuts hopes to siphon at least some of Starbucks’ customers
Dunkin’ Donuts is taking aim at Starbucks, expanding across the country — and on other continents — in an attempt to snatch business away from its higher-end rival. Just look at the numbers: Last year, Dunkin’ Donuts opened its 12,000 restaurant, a lcation in Riverside, California. This new restaurant was important not just because of that nice, round number. It’s also evidence of just how aggressive the chain has become in launching new locations.
- January 03, 2017
Cap Rates for Net Leased Retail Properties Increase for First Time in Three Years
Cap rates in the fourth quarter of 2016 for the single-tenant net lease sector increased or remained the same for office, retail and industrial assets, according to The Boulder Group’s quarterly Net Lease Market Research Report. Retail cap rates experienced their first increase since the third quarter of 2013 to 6.19 percent. The nine-basis-point increase is the largest quarterly increase in retail cap rates since the second quarter of 2011.
- December 01, 2016
Investors Stay Interested In Health Clinics
The single tenant medical sector remained popular with investors through the first three quarters of 2016, and several demographic factors will likely sustain that interest over the next few years, regardless of changes in the nation’s political landscape.
- November 02, 2016
Net-Leased Drug Stores’ Rising Cap Rates
Cap rates for single-tenant CVS, Rite Aid and Walgreens properties all increased significantly in the third quarter of 2016. Cap rates for the net-leased drug store sector increased by 51 basis points to a 6.0 percent cap rate when compared to the prior year. Rite Aid and Walgreens cap rates experienced the largest increases, at 35 and 37 basis points, respectively, due to investors’ concern about store closures with Walgreens’ potential acquisition of Rite Aid. In the same timeframe, CVS cap rates increased by 30 basis points.
- November 01, 2016
Drug Store Cap Rates Jump, Reversing Long-Term Trend
Reversing a long-term trend, cap rates for single tenant CVS, Rite Aid and Walgreens properties all increased significantly in the third quarter of 2016, according to a new report by the Boulder Group, a net lease firm in suburban Chicago. Investors seem most concerned by US antitrust regulators’ requirement that Walgreens sell between 500 and 1,000 stores before they will approve its plan to acquire Rite Aid.
- October 20, 2016
Retail Single-Tenant Net Lease Cap Rates at Record-Lows
Single-tenant net-lease cap rates for retail properties reached a record-low 6.10 percent in the third quarter, reported Boulder Group, Northbrook, Ill. STNL cap rates for the office and industrial sectors also decreased to 7.08 percent and 7.14 percent, respectively, said Boulder Group Vice President John Feeney. "The overall net-lease market remains active with 1031 and private investors due to the passive nature of the leases and attractiveness of relative investment returns when compared to other asset classes," Feeney said.
- October 10, 2016
Private Investors Double Down on Net Lease Assets as Institutional Buyers Step Back
Private investors turned more of their attention to single-tenant net lease assets this year, as institutional buyers pulled back from the property type due to the tightening in the capital markets in the early months of 2016.
- October 05, 2016
NET LEASE WAS GOLDEN IN Q3
The stable yields of net-lease real estate continue to drive investor demand, compressing cap rates in the sector to levels not seen in years. That's according to net lease king The Boulder Group, which released its Q3 2016 net lease research report.
- October 04, 2016
Retail Cap Rates Reach Another Historic Low
Strong demand from 1031 and private investors pushed cap rates for the single tenant net lease retail sector down slightly to just 6.1%, another historic low, in the third quarter of 2016, according to a new report from the Boulder Group, a net lease investment firm in suburban Chicago. During the same period, cap rates for the office and industrial sectors decreased to 7.08% and 7.14% respectively, declines of 17 and 12 bps. Retail cap rates have stayed below 6.65% since early 2015.
- September 28, 2016
Drugstore Sells At Lowest Cap Rate For A CVS In 2016
Net leased investment brokerage firm, The Boulder Group, has completed the sale of the single-tenant new construction CVS Pharmacy ground lease located at 2501 N. Field St. for $14.89 million. Randy Blankstein and Jimmy Goodman of The Boulder Group represented the buyer in the transaction. The seller was a Texas-based real estate company which was represented by Landes Fairmont.
- September 07, 2016
Net Lease Dollar Store Supply Moves Cap Rates Higher
Cap rates within the single-tenant net lease dollar store sector increased by 15 basis points from the second quarter of 2015 to the second quarter of 2016, to a 6.65 percent cap rate. The dollar store sector, for the purpose of this report, is defined as free-standing Dollar General, Dollar Tree and Family Dollar properties, as these tenants represent the largest presence within the sector. Cap rates for Family Dollar assets remained unchanged, while Dollar General and Dollar Tree experienced increases of 10 and 15 basis point, respectively.
- September 01, 2016
Cap Rates Hint at Tempered Growth for Discount Retailers
In recent quarterly earnings periods, full-price retailers such as department stores and specialty retailers have been the companies to report weaker sales, revised annual guidance figures and planned store closures. Their reports underscored the challenges facing the retail sector impacted by an omni-channel revenue model.
- August 30, 2016
Dollar Stores Remain Popular With Investors, Consumers
The US dollar store sector has continued to expand in the past year due to consumers’ demand for low-cost goods. That expansion has also opened up a lot of opportunities for investors that want to jump into this robust segment of retail.
- August 02, 2016
Quick Service Restaurants Drawing In Investors
Cap rates in much of the single tenant net lease sector hit historic lows during the economic recovery, but recently those declines have moderated. The net lease quick service restaurant sector, however, saw its median cap rates sink to 5.7% in the second quarter of 2016, a compression of 10 bps from the prior year, according to a new report from the Boulder Group, a Northbrook, IL-based net lease firm.
- July 26, 2016
Second annual Net Lease Conference brings in the big names
Midwest Real Estate News held its second annual Net Lease Conference July 20 in Chicago. More than 160 net lease pros from around the country attended, all there to celebrate the continuing strength of the net lease business, in all sectors. Some of the biggest names in the net least industry shared their insights on why this part of the commercial real estate business continues to thrive.
- July 21, 2016
Cap Rates Steady Despite Supply Jump
Single-tenant net lease property cap rates held steady or increased just slightly in the second quarter even as significant new supply reached the market, reported Boulder Group, Northbrook, Ill. STNL retail sector cap rates remained unchanged at a historic low 6.18 percent while office cap rates increased five basis points to 7.25 percent and industrial cap rates increased 16 basis points to 7.26 percent, said Boulder Group Vice President John Feeney.
- July 06, 2016
Net Lease Supply on the Rise
Cap rates for the single-tenant net lease retail sector remained unchanged in the first quarter, sustaining their historic low rate of 6.18 percent. During the same timeframe, cap rates for the office and industrial sectors increased to 7.25 and 7.26 percent, respectively. While cap rates remained stable in the second quarter, an influx of net lease assets entered the market, increasing the total supply by approximately 11 percent.
- July 05, 2016
Industrial Net lease Cap Rates Soar in Q2
How did the net-lease sector fare in the first six months of 2016? Pretty darn well, according to The Boulder Group's Q2 market report. While retail net-lease cap rates remained steady between Q1 and Q2, office caps rose 5% to 7.25%, and industrial net-lease cap rates increased an amazing 16%, from 7.1% in Q1 to 7.26% in Q2.
- July 05, 2016
Net Lease Cap Rates Headed Up
Cap rates for net lease properties have been trending downward for more than five years, and recently sank to historic lows. But that long-term decline may be at an end. In the first quarter of 2016 cap rates for the single tenant net lease retail sector remained unchanged at their historic low rate of 6.18%, according to a report just issued by the Boulder Group, a net lease firm in suburban Chicago. However, during the same timeframe, cap rates for the office and industrial sectors increased 5 bps and 16 bps, respectively, to 7.25% and 7.26%.
- June 01, 2016
Net Lease Casual Dining is Strong in Q1
Retail has been golden in the first half of 2016. Net lease retail even more so, especially if you have a quick casual dining tenant occupying your assets. That's according to a new report from single tenant net lease kings The Boulder Group.
- May 20, 2016
Bucktown Walgreens Sells For Big Number
CHICAGO—An investor has just bought a single tenant net leased Walgreens property located in Chicago’s Bucktown neighborhood for $11,275,000. That big number helps illustrate just how desirable the neighborhood has become. New home construction has boomed in the blocks surrounding the property, and the new Bloomingdale Trail, also known as “The 606,” is just a short walk to the south and brings in thousands of walkers, runners, and bikers every day.
- May 05, 2016
As Store Counts Rise, Dollar General’s Cap Rates Could Hit New Lows
Dollar General has been on a winning streak, both as a retailer and as a net lease investment, since the economy began to recover in 2009.
- May 04, 2016
Net Lease Bank Demand Softens on Branch Model Concerns
Cap rates for the single-tenant bank ground-lease sector increased significantly to 4.75 percent in the first quarter of 2016 after reaching a previous historic low of 4.35 percent one year ago.
- May 02, 2016
Net Lease Cap Rates Set Records
Net lease retail investment is hitting new lows, but that’s a sign of its high esteem among investors.
- April 28, 2016
Net Lease Bank Rates Headed Up
Net lease investors have for some time considered bank branches one of the best investments on the market, pushing down the cap rates for these properties to historically low levels. In the past year, however, things have changed, and rates took a big jump upward, according to a new study by the Boulder Group, a net lease firm in suburban Chicago.
- April 27, 2016
1031 Buyers Battle Competition for Assets, Proposed Reforms
The strong investment sales environment in the past two years has created a booming 1031 exchange market. Yet renewed discussion about potential tax code reforms and an intensely competitive sales market is casting a bit of a shadow on the sector.
- April 22, 2016
The Boulder Group’s Blankstein to chair Midwest Real Estate News’ Net Lease Summit Conference
Randy Blankstein, president of the Boulder Group, will serve as conference chair of Midwest Real Estate News’ second annual Net Lease Summit Conference. The conference will be held July 20 in Chicago. Blankstein will also monitor a panel at the conference that will address the state of the net lease market.
- April 08, 2016
Single-tenant retail property prices hit all time high: Report
Cap rates for the single-tenant net-lease retail sector hit a historic low rate of 6.18 percent in the first quarter, according to Boulder Group’s quarterly survey. The spread between asking and closed cap rates on such properties was 24 basis points, up by 1 point from the previous quarter, the firm reports.
- April 07, 2016
Who’s Winning the Grocery Race?
Grocery chains might look like they have it easier than apparel retailers. They fall under the “necessity retail” grouping, after all, and which household doesn’t need to stock up on everything from paper goods to produce regularly?
- April 07, 2016
Some STNL Sectors See Record-Low Cap Rates
Single-tenant net lease cap rates for retail and industrial properties reached record lows of 6.18 percent and 7.10 percent respectively in the first quarter, reported Boulder Group, Northbrook, Ill.
- April 06, 2016
Sit-down Restaurants, Drugstore Property Sales Propping Up Weak Triple-Net Investing
Could investors finally be feeling net-lease fatigue? When stocks plunged, hordes of mostly mom-and-pop investors surged into the single-tenant, net-leased property market, snapping up drugstores and restaurants at record numbers, and helping lead commercial real estate out of the last Great Recession.
- April 06, 2016
Net Lease Investors Show Greater Interest in Industrial Assets
Net lease investors appear to be developing a greater appetite for properties occupied by industrial tenants, according recent reports from The Boulder Group, a net lease commercial real estate firm headquartered in Northbrook, Ill.
- April 04, 2016
Retail And Industrial Cap Rates Reach Historic Lows
The national net lease market continues to be intensely competitive and entice a record number of investors. Cap rates in the first quarter of 2016 for the single tenant net lease retail and industrial sectors reached a new historic low rate of 6.18% and 7.10% respectively, according to a report just published by the Boulder Group, a net lease firm located in suburban Chicago. But cap rates for the office sector did increase by 20 bps to a cap rate of 7.20%.
- March 09, 2016
The Wal-Mart Effect
Recent data suggests that the Walmart Neighborhood Market chain is driving down cap rates on net-leased big-box stores. An influx of new units in the fourth quarter of 2015 helped tighten cap rates in the sector by 63 basis points, according to an assessment by The Boulder Group.
- March 04, 2016
Excess demand for net-lease properties
Excess demand for net-lease properties More investors compete for a dwindling supply of single-tenant net lease properties
- March 03, 2016
Net Lease Auto Parts Sector Outpaces Market
Cap rates for the single-tenant, net-leased auto parts store sector decreased by 27 basis points from the fourth quarter of 2014 to the fourth quarter of 2015, reaching 5.98 percent.
- March 02, 2016
Investors’ Demand For Auto Parts Stores Still Growing
Cap rates for the single tenant net leased auto parts store sector sank to 5.98% in the fourth quarter of 2015, a decrease of 27 bps from the previous year, according to a new study from the Boulder Group, a net lease firm in suburban Chicago.
- February 18, 2016
The Walmart Effect: Compressed Cap Rates on Net-Leased Big Boxes
Recent data suggests that the Walmart Neighborhood Market chain is driving down cap rates on net-leased big-box stores. An influx of new units in the fourth quarter of 2015 helped tighten cap rates in the sector by 63 basis points, according to an assessment by The Boulder Group, a real estate investment firm specializing in single-tenant net-leased properties.
- February 15, 2016
Net Lease Cap Rates Hit New Historic Lows
Cap rates for single tenant net lease retail were unchanged in the fourth quarter, but industrial and office properties declined again.
- February 15, 2016
Net Lease Column: Cap Rates at Historic Lows
Cap rates in the single-tenant net lease sector closed 2015 at historic lows. Will the trend continue this year?
- February 15, 2016
Will Icahn’s Acquisition of Pep Boys Affect the Net Lease Market?
Activist investor Carl Icahn has won the bidding war for Pep Boys, beating out Bridgestone Corp. to claim the Philadelphia-based automotive aftermarket chain. The deal is valued at roughly $1 billion—a staggering number when compared to the $800 the Pep Boys founders initially invested in 1921.
- February 15, 2016
New Walmart Market Depress Cap Rates
The single tenant net lease big box sector saw a significant shift in 2015, according to the latest report from the Boulder Group, a net lease firm based in suburban Chicago. Cap rates compressed from the fourth quarter of 2014 to the fourth quarter of 2015 by 63 bps to 6.08%. That decline was steeper than seen in the entire net lease retail sector, which compressed by only 25 bps during the same period. This represents the first time since 2010 that the big box sector was priced at a premium to the entire retail net lease market.
- February 15, 2016
Big-Box Properties Outperform
Cap rates for net-leased big-box properties declined in 2015, leading to increased investor demand for the low-risk assets—but is there enough supply to go around?