Net Lease Cap Rates Continue to Expand
Increased borrowing costs and a decreasing amount of 1031 exchange investors hinder activity.
Cap rates in the single tenant net lease sector increased for the third consecutive quarter in the fourth quarter of 2022, according to new research from The Boulder Group. Single tenant cap rates increased to 5.95%, an increase of 9 bps, for retail, 6.95% (+15 bps) for office and 6.65% (+4 bps) for industrial in the quarter.
“Continued upward pressure mounts on cap rates for net leased properties,” says Randy Blankstein, President, The Boulder Group.