Where are Cap Rates Heading?
CAP rates are still firm in most investment segments of the market. We see CAP’s as low as 5.25 in some west coast investments. New Walgreens are holding in the 6.25-6.40 opening price offerings in good locations. Advance Auto and Auto Zones list in the 6.50 range for new store locations. Video and Fast Food new offerings are approaching 7.0 and up. Multi-tenant office and Industrial investments are all over the board depending upon tenant strength, location, the age of the property and base lease terms. Firming of office rental rates has helped that market segment. Retail and Multi-family investments are in greatest demand and are holding near 2005 CAPs.
Thanks to Dan Whipple, CCIM for this contribution.
Thanks to Dan Whipple, CCIM for this contribution.
source: Where are Cap Rates Heading?
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