Net lease investors are expanding beyond the typical retail investment. Retail has been the main target asset class for net lease investors, but following the pandemic, retail-occupied industrial and logistics is fast becoming a new favorite.

Net lease advisory firm SRS Real Estate Partners National Net Lease Group rode the trend to a record-breaking year, an impressive feat considering the market change. The firm completed more than $1.9 billion in total net lease transaction volume comprised of 534 deals including debt/equity and valuations in 2020. "We were always retail only, but net lease is now encompassing more. It is a wider net and a wider product type. Investors are branching out with the market, and where our clients go, we go," Matt Mousavi, managing principal at SRS, tells GlobeSt.com.

At the start of the pandemic, Mousavi expected trade buyers to exit the market following the July extension—but that never happened. "We were up 26%, and I didn't think we would be there if you asked me last March," he says. "There was a fear that trade buyers were going to go away, but there was never an issue. The market is still very active. There is so much demand and liquidity, and there is continued 1031 exchange activity. Low interest rates are really helping, and they are driving attractive cash-on-cash returns."