Public, Private Funds Chase Single-Tenant Net Lease Deals
These funds include foreign capital, which is targeting mainly office and industrial assets, says VEREIT’s Dan Lovitz.
NEW YORK CITY— Net Lease REITs have become an important property sector in which highly predictable rent checks are turned into highly sustainable dividends. External growth fueled by the favorable cost of capital has contributed to the sector’s significant performance. 2019 was a year of steady growth for the single-tenant net lease sector, according to Phoenix-based Dan Lovitz, SVP of acquisitions at VEREIT Inc. VEREIT owns one of the largest portfolios of single-tenant commercial properties in the U.S. and continued to strengthen its portfolio through “maintaining a very liquid and flexible balance sheet in 2019,” stated Lovitz.
Lovitz will serve as a panelist during the net lease REIT’s update panel at the upcoming GlobeSt. 18th annual national net lease conference in New York City. Lovitz’ session will explore the primary triggers and trends that investors should watch in 2020 including: cost of capital, operating efficiency and value, and sector consolidation.
So what can we expect looking ahead in this sector? Lovitz tells GlobeSt.com that over time, single-tenant net lease investments have proven to be safe, long-term investments with low volatility. “As long as the underlying real estate fundamentals (location, rent price per square foot, ingress/egress) are strong, investing in single tenant net lease assets provide a hands-off investment that requires minimal day to day management with attractive returns.”
He adds that there has been an influx of funds, both public and private, that are purchasing single-tenant properties in the US. “The net lease sector is as competitive as it’s ever been and now we have seen foreign capital make a push into the space (predominantly in office and industrial).”
The 18th GlobeSt Net Lease Conference (formerly a RealShare Event) will bring together the industry’s most influential and knowledgeable real estate executives from the net lease sector. To hear more from Lovitz and gain insights from other experts in the space and prepare your transactions & investments for continued success, click here to register.