Overall net lease retail cap rates continue to hover around the upper 6th and lower 7th percentile range. The overall net lease retail average for 2013 ended up at 7.05% and as we enter 2014 we expect averages to remain closely bound to this relative range (with periodic fluctuations). C-Stores and Pharmacies continue to have some of the lowest cap rate averages (6.34% and 6.41% respectively) while Dollar Stores and Automotive range higher (7.22% and 7.07% respectively). As 2014 wears on and interest rise, it is likely cap rates will begin to gradually increase. There is still a high level of disparity between grade-A assets in prime locations, with long leases and investments which may not be a credit tenant or in a tertiary area. Urban assets are especially prized with some recently trading at higher price per square foot values than have been seen before. Areas like Washington DC, New York, Houston etc continue to be heavily prized.
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Jonathan Hipp
Jonathan Hipp began his career in real estate over 25 years ago. In his early years as a broker, he ventured into the net lease industry and quickly began leading the US net lease market, closing over $3 billion in transactions. In 2005, Jon founded Calkain Companies, a company focused solely on net lease investment services. As President and CEO, he has been instrumental in building the firm into one of the leading Net Lease real estate companies, transacting over $12 billion of net lease deal volume over the past 13 years. He has expanded Calkain’s services to include brokerage, advisory, asset management, capital markets, and industry research. He has become a well-known resource, panelist, and speaker at various Net Lease and Industry conferences and is a regular contributor to GlobeSt.com on real estate trends. In June 2015, Jon’s passion for the real estate business was again recognized as he was nominated for the Top Real Estate Player in the DC area by SmartCEO magazine.
