It was clear at least years ICSC that net lease properties had become an industry in and of itself. A large portion of the ICSC RECON attendees focused heavily on them. With demand for net leases only increasing since, it is likely they will play an important part at this years conference.
2014 has already seen attention grabbing events with relation to net leases. An easy example is American Reality Capital's purchase of CapLease for $2.2 billion and merger with Cole Real Estate (a transaction worth $11.2 billion) to create the largest net lease REIT with an enterprise value of $21.5 billion. Events such the American Reaility Capital merger highlight that net leases are shrugging off their niche status as they become a fully integrated component of the commercial property portfolio.
Above all, buyers, both private and institution, continue to aggressively seek and pursue single tenant properties even as pricing continues to tighten. Accordingly, developers and owners are capitalizing on the ability to sell into a strong market, while exploring additional built-to-suit and ground lease opportunities. Regardless of higher interest rates, the net lease market shines brighter.
In short, the net lease market is charged with energy and surging forward. New developments have been increasing as cap rates have decreased. Demand continues to grow. We expect this years ICSC to be buzzing with energy.
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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.
