Commercial Investment Real Estate May/June 2017 - Page 17
Single-Tenant Net-Leased Cap Rates vs. 10-Year
STNL Cap Rates
10-Year Treasury Rates
Source: Calkain Research
Real estate investors seem willing to consider second-tier cities
in their search for solid yields.
With the corporate bond market yields still in the 2-percent
range, the tendency will be to mitigate upward pressure on the
real estate yields.
The Federal Reserve may raise interest rates by as much
as 2 percent during 2017, which will cause triple-net leased
property cap rates to rise only slightly since that expectation
is built into the market. While there may be slight adjust-
ments, the triple-net lease market will continue a fairly
steady course this year.
Ryan Lorey, CCIM, is a director at Calkain Companies in
Herndon, Va. Contact him at firstname.lastname@example.org.
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May | June 2017