In the second quarter, national asking cap rates in the single-tenant dollar store sector fell to 6.11%, according to The Boulder Group's 2021 Net Lease Market Report.
The Boulder Group attributed the cap rate compression to a limited supply of new construction properties with investment-grade tenants and long-term leases.
"It's a confluence of interest rates and it's a confluence of where cap rates are today," says Randy Blankstein, president of The Boulder Group. "Dollar stores have benefited from a flight to safety during COVID. Because of COVID, new development got pushed aside for most tenants, and the dollar stores are aggressively growing as much as everybody."
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Leslie Shaver
Les Shaver has been covering commercial and residential real estate for almost 20 years. His work has appeared in Multifamily Executive, Builder, units, Arlington Magazine in addition to GlobeSt.com and Real Estate Forum.
