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Net Lease Takes Bigger Slice of Smaller Investment Sales Pie
Net-lease investment declined by 61.8% year-over-year in the second quarter, but comprised the highest share of total volume on record amid a sharp decline in commercial real estate investment activity caused by the COVID-19 pandemic, CBRE reported. Sales of net-leased office, industrial and retail properties reached 20.2% of Q2 investment volume, up from 13.3% in Q1.
The net-lease sector exhibited a comparable trend during the Great Financial Crisis (GFC), when its share of total volume also increased substantially. “Similar to the GFC trend we experienced over a decade ago, net lease investment continues to attract demand during this downturn as investors are seeking long-term dependable cash flows,” said Will Pike, vice chairman of net lease properties for Capital Markets at CBRE.
While large gateway markets continue to garner the most activity, investors are increasingly attracted in high-growth secondary and tertiary markets, such as Memphis, Austin, San Antonio, Philadelphia and Cincinnati.
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- ◦Sale/Acquisition
- ◦Lease
