(Save the date: RealShare Chicago comes to the Union League Club of Chicago October 23.)
CHICAGO-The supply-demand ratio for core single-tenant, net-lease retail properties continues to shrink, forcing cap rates to do the same. Whereas most investments, such as bonds and stocks, have seen low yields, net-lease retail has an average cap rate of about 7.5% to 7.7% - if available at all.
Second quarter reports from Chicago-based net-lease companies Boulder Group and Quantum Real Estate Advisors Inc., and today's GlobeSt.com exclusive interview, detail the compression of core net-lease property in top markets. Dan Waszak, VP with Quantum, says core markets such as New York City or Los Angeles have cap rates that are down about 175 basis points, and assets with investment-grade tenants such as Walgreens or Chase Bank are still the standard, commanding cap rates between 5.5% and 6.5%.
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