STNL Still Performing Out West, Though a Settling Period May Be on the Horizon

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Shopping Center Business (Video Interview)

The single-tenant net lease (STNL) market remains strong throughout the Western region, according to Bill Asher, executive vice president of Hanley Investment Group.

In coastal markets, cap rates and pricing have been consistent over the last 2-3 years. Additionally, properties leased to nationally recognized retailers with long-term leases and brand-new construction have insulated themselves from recent interest rate increases. Buyers remain as interested as ever in pad sites and credit tenants, including Starbucks, Chick-fil-A, and 7-Eleven, Asher notes.

All-cash buyers have also maintained their leg up over borrowers, especially in this rising interest rate environment. Asher has seen the most net-lease activity for assets priced at $7 million or less. Though these deals are still trading for a premium, he does believe a settling period may be upon us as rates and the 10-Year Treasury creep up.

Click Here to hear the rest of Asher’s thoughts on the West’s STNL market.