{"id":1004782992,"date":"2026-01-07T06:18:54","date_gmt":"2026-01-07T14:18:54","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004782992"},"modified":"2026-03-23T01:52:10","modified_gmt":"2026-03-23T09:52:10","slug":"private-buyers-boost-net-lease-retail-deals","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/private-buyers-boost-net-lease-retail-deals\/","title":{"rendered":"Private Buyers Boost Net Lease Retail Deals"},"content":{"rendered":"\n

U.S. single-tenant net lease retail transactions<\/a> rose by 18 percent year-over-year for the first three quarters of 2025, driven by a resurgence of private investors seeking stable, low-management assets, according to a new Marcus & Millichap report.<\/p>\n\n\n

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Single-tenant net lease retail provides stable long-term cash flow, according to John Chang, Marcus & Millichap’s chief analytics & intelligence officer. Image courtesy of Marcus & Millichap<\/em><\/figcaption><\/figure><\/div>\n\n\n

The dollar volume for STNL retail investments was also up, rising 14 percent. While the total was a 15 percent decrease in dollar volume since 2021, it was still higher than for any year prior to that point.<\/p>\n\n\n\n

Compared to the previous low in 2023, dollar volume increased 25 percent through the third quarter. The improved transaction activity helped increase the average price slightly to $334 per square foot as buyer and seller expectations were better aligned, Marcus & Millichap reported.<\/p>\n\n\n\n

Private investors accounted for 71 percent of transactions, far surpassing other buyer categories. Foreign buyers were a distant second with 10 percent, followed by REITs (9 percent), institutional investors (6 percent) and cross-border investors (4 percent).<\/p>\n\n\n\n

On a trailing 12-month basis, the individual investor share of the STNL market was up by 15 percent, while portfolio investments declined 6 percent. Entity-level transactions were also down 98 percent, largely because no deals matched the scale of the Realty Income-Spirit Realty Capital merger<\/a>. That $93 billion, all-stock deal closed in January 2024 and created a 15,000-property portfolio with an enterprise value of $63 billion. Increased private investment helped offset the decline in enterprise-level deals, Marcus & Millichap found.<\/p>\n\n\n\n

Higher interest rates suppressed overall STNL retail transaction volume in 2023 and 2024, but last year\u2019s interest rate cuts<\/a>, aligning with a dip in the 10-year Treasury, may result in more transactions penciling in the fourth-quarter tally.<\/p>\n\n\n\n

\u201cOver the course of the last year, private investors have favored single-tenant net-lease retail assets as the combination of falling interest rates and reinvigorated bonus depreciation rules were enacted,\u201d said John Chang, senior vice president, chief intelligence & analytics officer at Marcus & Millichap. \u201cSTNL properties can provide investors with predictable long-term cash flow without requiring extensive management, while narrowing vacancy risk to a single tenant.\u201d<\/p>\n\n\n\n

This focus translates into a premium for longer lease terms and higher credit grade tenants, reflected in tighter average cap rates.<\/p>\n\n\n\n

\u201cWhile the spread between cap rates and the 10-year Treasury is not as wide as it has been at some points in the past, the long-term stable cash flow stream that can be achieved in this sector continues to offer a compelling investment option,\u201d Chang told Commercial Property Executive.<\/em><\/p>\n\n\n\n

Close-up on cap rates<\/h2>\n\n\n\n

The mean cap rate has been holding at 6.5 percent, a 12-year high. But the market is placing a higher premium on top-tier credit grade tenants, resulting in downward pressure on the mean cap rate versus the overall market average, according to Marcus & Millichap.<\/p>\n\n\n\n

Historically, the premium to acquire an asset with a top credit tenant over a lower-tier tenant averages 100 basis points. As of September, the spread had widened to 140 basis points. That has been occurring while mid-tier cap rates have moved closer to the lower-tier average since 2022, and while the mean top-tier cap rate has declined since 2024.<\/p>\n\n\n\n

Lease term length has been playing a decisive role in cap rate pricing, with short-term leases garnering significantly higher yields to allow for rollover risk, the report states. Properties with five to 15 years remaining on the lease were closely aligned with the overall market average at a 6.8 percent average cap rate.<\/p>\n\n\n\n

Those with five years or less left on the lease were perceived to have a higher risk factor and limited rent certainty, resulting in average 7.7 percent cap rate. Properties with more than 15 years remaining on their leases had an average 6.1 percent cap rate due to reduced vacancy risk and greater income security, despite limits on rent increases.<\/p>\n","protected":false},"excerpt":{"rendered":"

A new Marcus & Millichap report on what’s driving resurgent investment in single-tenant assets. <\/p>\n","protected":false},"author":1068,"featured_media":1004507583,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21783,23891,21742,21749],"tags":[],"class_list":["post-1004782992","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment","category-national","category-latest","category-retail"],"acf":[],"yoast_head":"\nPrivate Buyers Boost Net Lease Retail Deals - Commercial Property Executive<\/title>\n<meta name=\"description\" content=\"A new report from Marcus & Millichap analyzes the surge of private investment in net lease retail properties.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/private-buyers-boost-net-lease-retail-deals\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Private Buyers Boost Net Lease Retail Deals\" \/>\n<meta property=\"og:description\" content=\"A new report from Marcus & Millichap analyzes the surge of private investment in net lease retail properties.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/private-buyers-boost-net-lease-retail-deals\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2026-01-07T14:18:54+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-03-23T09:52:10+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2021\/03\/John-Chang.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"620\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Gail Kalinoski\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/private-buyers-boost-net-lease-retail-deals\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/private-buyers-boost-net-lease-retail-deals\/\",\"name\":\"Private Buyers Boost Net Lease Retail Deals - 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