Net Lease Bank Investors Turn Selective

Net Lease Bank Investors Turn Selective

Increasing cap rates and limited supply are leading net lease investors to carefully review acquisition opportunities, observes The Boulder Group President Randy Blankstein.

Cap rates for the single-tenant bank ground-lease sector increased by 21 basis points (bps) to 4.84 percent in the first quarter of 2018, compared to one year ago. At the same time, the supply of bank ground leases on the market decreased by 18 percent. While bank ground-lease cap rates were on the rise this past year, the cap rates for the overall net lease retail sector compressed by 9 bps. Accordingly, the significant cap rate premium historically associated with the bank ground-lease sector compressed to 136 bps from 156 bps. For the purpose of this report, the bank ground-lease sector comprises both national and regional banks, regardless of credit.

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Net Lease Bank Investors Turn Selective

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The Boulder Group is a boutique investment real estate service firm specializing in single tenant net lease properties. The firm provides a full range of brokerage, advisory, and financing services nationwide to a substantial and diversified client base, which includes high net worth individuals, developers, REITs, partnerships and institutional investment funds./

Founded in 1997, the firm has arranged the acquisition and disposition of over $2.1 billion of single tenant net lease real estate transactions. In 2010-2014, the firm was ranked in the top 10 companies in the nation for single tenant retail transactions by Real Capital Analytics. The Boulder Group is headquartered in suburban Chicago

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