Griffin says that cap rates have receded for several reasons. The most often cited is lower interest rates, which makes borrowing money cheaper. This enables an investor to pay higher price and achieve the same leveraged return had he or she paid a lower price in a higher interest rate environment.

Another reason for falling cap rates, Griffin says, is investors' lack of confidence in other investment alternatives. The stock market's volatility and the bond market's trouble with climbing interest rates are the primary culprits. Relative real estate market stability and recent appreciation of values combined with a perceived lack of viable alternatives, makes real estate ea more accepted asset class than it has been in the past, he says.

Also, a shortage of properties available for purchase and ample money on the sideline has helped push prices higher and cap rates lower. What that means is that investors are willing to accept lower returns, he says. "Going forward, there is still a strong demand for retail assets," Griffin says. "Buyers are continuing to compete for a limited number of properties, putting upward pressure on prices."