Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Save to My Library
Look up keyword
Like this
3Activity
0 of .
Results for:
No results containing your search query
P. 1
Net Lease Research Report

Net Lease Research Report

Ratings: (0)|Views: 10 |Likes:
Published by netlease
net lease research report published by The Boulder Group
net lease research report published by The Boulder Group

More info:

Published by: netlease on Oct 23, 2012
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

12/04/2012

pdf

text

original

 
THE NET LEASE MARKET REPORTQ3 2012
www.bouldergroup.com
Cap rates for the single tenant net leased market remained nearunprecedented levels across retail, office and industrial sectors in thethird quarter of 2012. Cap rates for net leased office properties declinedslightly and net leased industrial properties rose slightly, while cap ratesfor net leased retail properties remained unchanged. The primary factorcontributing to the stagnation of cap rates for retail properties can beattributed to the plateau of investor yield thresholds as cap rates remainnear historic lows. Additionally, the ten year treasury’s decline from theprevious quarter halted in the third quarter of 2012 after reaching itslowest point of the year in mid-July. The recent increase in the ten yeartreasury had limited effect on cap rates due to the limited supply of newlyconstructed properties.The net lease market continues to be limited by the constricteddevelopment pipeline and a limited existing supply of long term leasedproperties. The third quarter of 2012 experienced a 7.8% decrease insupply for all three property sectors. As a result of the decreased supplyand continued demand, the increased competition amongst net leasedinvestors in the third quarter of 2012 has triggered the national bid askspread to compress by six basis points on average when compared tolast quarter. Accordingly, the average marketing time for net leaseproperties has decreased by 20% over the past twelve months.Investors are challenged to reach their yield thresholds with newlyconstructed properties due to near record low cap rates. Consequently,investor interest in properties with less than fifteen years of lease termhas increased, most notably drugstore properties with strong salesperformance. For example, the increased demand for Walgreensproperties constructed from 2000-2004, which typically have higheryields, has caused cap rates for these properties to decline by 50 basispoints in comparison to a year ago.The national single tenant net lease market should remain active as theyear end approaches and institutional investors seek to hit acquisitiontargets. Additionally, there will be an increased amount of sellers to takeadvantage of current capital gains rates as it remains uncertain howgovernment policies will impact the net lease market in 2013. With caprates near historic lows and new construction supply diminished, themajority of industry professionals believe the market will remainfavorable to sellers for the remainder of the year. As the upcoming election looms, it is unclear as to what effect its outcome will have on thenet lease industry in 2013.
NUMBER OF PROPERTIES ADDED TOMARKET IN Q3
Sector
RetailOfficeIndustrial
Q2 2012(Previous)
3,508455384
Q3 2012(Current)
3,256397358
PercentChange
-7.18%-12.75%-6.77%
MARKET OVERVIEWNATIONAL ASKING CAP RATES
Sector
RetailOfficeIndustrial
Q2 2012(Previous)
7.50%8.25%8.00%
Q3 2012(Current)
7.50%8.00%8.20%
Basis PointChange
0-25+20
NATIONAL BID - ASK CAP RATE SPREAD
Q2 2012(Previous)
265363
Q3 2012(Current)
175058
Basis PointChange
-9-3-5
Sector
RetailOfficeIndustrial
 
THE NET LEASE MARKET REPORTQ3 2012
NET LEASED CAP RATE TRENDS
8.75%8.35%7.55%6.75%7.15%7.95%
Q12005Q22005Q32005Q42005Q12006Q22006Q32006Q42006Q12007Q22007Q32007Q42007Q12008Q22008Q32008Q42008Q12009Q22009Q32009Q42009Q12010Q22010Q32010
RetailOfficeIndustrial
SELECTED SINGLE TENANT SALES COMPARABLES
Date
Sep-12Sep-12Jul-12Aug-12Sep-12Sep-12Aug-12Sep-12Aug-12Jul-12
Sector
OfficeRetailOfficeIndustrialIndustrialRetailRetailRetailRetailRetail
Tenant
HCA, Inc.Pick N' SavePanasonicMarsh SupermarketsAmerican TireWalgreensWawaWalgreensRite AidHome Depot (GL)
City
Irving SheboyganLake Forest YorktownColorado SpringsNorristownCape MayChicagoNorth HavenBlaine
State
TXWICAINCOPANJILCTMN
 Per SF
 $164$202$222$55$66$535$1,330$549$455$13
Rate
7.60%7.67%7.65%8.64%7.90%6.27%6.75%6.53%8.75%6.01%
Remaining
10191015112114171816 
Q42010Q12011Q22011Q32011Q42011
www.bouldergroup.com
PriceCapLease TermSale
Q12012Q22012
 Price
$15,483,000$14,122,000$13,050,000$10,322,450$8,311,000$7,765,000$7,639,896$7,500,000$6,688,000$6,650,000
Q32012

You're Reading a Free Preview

Download
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->