Average Single Tenant Retail Property Cap Rate Increases to 7.02%

The average U.S. asking cap rate for single-tenant retail properties climbed slightly in the third quarter, to 7.02 percent, from 7 percent in the second quarter, according to The Boulder Group.

The firm says higher interest rates related to the 10.4 percent increase in the 10-year Treasury yield from July to August contributed to the modest cap-rate climb.

The spread between asking cap rates and closing cap rates was 22 basis points in the third quarter, versus 25 in the second quarter, according to Trepp.

Owners put 2,502 single-tenant properties on the market in the third quarter, down from 2,760 in the previous quarter, Trepp says.

Retail properties remain in highest demand among single-tenant property investors, as evidenced by the premium over office and industrial properties of 68 and 98 basis points, respectively.

Source: ICSC Shopping Centers Today, October 4th 2013
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