Cap Rates Rise in the Net Lease Dollar Store Sector

The supply of single-tenant dollar store properties increased by 34 percent in Q2–2017 when compared to Q2–2016 with cap rates rising from 6.65 percent to 6.75 percent during this period, according to Commercial Property Executive. The significant increase in supply is attributed in part to new construction properties (properties up to 12 months old) which comprised more than 57 percent of the supply of net lease dollar stores in the second quarter of this year. Dollar store properties priced at a 52 basis point discount compared to the overall net lease retail market in the second quarter of this year.

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