Triple Net Lease Market News
Calkain’s Research Director, commented “This new data and evaluation confirms a general compression for cap rates driven by the demand for investment grade tenants occupying net leased properties in prime locations.”
Calkain Research, a division of Calkain Companies, has quantified that increased investor demand for triple net lease investments has brought an increase in prices.
For the first quarter of 2011, Triple net lease capitalization (cap) rates averaged 7.75% - down from 7.88% in 2010. This trend demonstrates that investors have been willing to reduce their overall return thresholds for sound and passive real estate investments. This also continues the trend of declining cap rates that have been observed since late 2010.
Top tier net lease properties, in well-located areas, are trading at some of the lowest cap rates and highest prices since the height of the real estate market in 2007. While recovery is uneven over all market segments, there is certainly improvement in the stabilized, income-producing net lease investments in which Calkain focuses.
Winston Orzechowski, Calkain’s Research Director, commented “This new data and evaluation confirms a general compression for cap rates driven by the demand for investment grade tenants occupying net leased properties in prime locations.”
Download the full cap rate report at www.calkain.com.
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