MarketSnapshot: Single-Tenant Retail

The single-tenant retail sector posted $2.2B in third quarter sales volume, down 13.5% from the second quarter and nearly 17% year-over-year. Cap rates recorded slight upward pressure, rising 1 basis point to 6.93%, and by 13 basis points year-over-year.

The Southeast region dominated transaction activity in the third quarter, recording $653.7M in volume and accounting for 29.7% of the total. The West followed with $430.9M, representing 19.6% of overall volume. The Southwest ranked third with $373.3M, or 16.9%, while the Northeast recorded $361.0M, representing 16.4%. The Midwest contributed $261.3M, or 11.9% of total volume, and the Mid-Atlantic region trailed with $123.2M, accounting for 5.6%.

By region, cap rates ranged from a low of 6.08% in the Northeast to a high of 7.60% in the Midwest. All regions, except the Northeast, recorded a modest increase over the prior quarter. Average cap rates are up 133 basis points from the recent low of 5.60% recorded in the fourth quarter of 2022.

Private buyers accounted for 68% of single-tenant retail acquisitions through the third quarter of 2025, followed by institutional investors at 8%. The private share rose sharply by 11% in 2024, while private investment activity increased by 2% over the same period. REIT/Listed acquisitions fell from 26% of investment activity in 2024 to 11% as of the third quarter of 2025.