Cap Rates, Demand Steady for Auto Parts

CHICAGO—The cap rates for net leased properties in the auto parts sector sank to historic lows about one year ago, and throughout 2014, those low rates have largely remained steady, according to a new report by the Boulder Group, a net lease firm in suburban Chicago. Rates in the sector went from 6.22% in the fourth quarter of 2013 to 6.25% by the end of last year.

“We were not surprised by the continued demand as average car age continues to rise despite the recession being over,” Randy Blankstein, president of Boulder, tells GlobeSt.com. According to a recent report by R.L. Polk & Co. and IHS Automotive, the average age of vehicles on the road has increased to 11.5 years. In addition, the researchers expect that the number of vehicles over 12 years old will increase 15% by 2019.