MarketSnapshot: Single-Tenant Retail

The single-tenant retail sector posted $3.3 billion in fourth quarter sales volume, up 36.5% from the third quarter and 14.6% year-over-year. Cap rates recorded slight upward pressure, rising 3 basis points to 6.92%, and 5 basis points year over year.

The Southeast region led transaction activity in the fourth quarter, recording $949.9 million in volume and accounting for 28.5% of the total. The West followed with $862.9 million, representing 25.9% of overall volume. The Southwest ranked third with $659.4 million, or 19.8%, while the Northeast recorded $402.4 million, representing 12.1%. The Midwest contributed $286.1 million, or 8.6% of total volume, and the Mid-Atlantic region trailed with $168.3 million, accounting for 5.1%.

By region, cap rates ranged from a low of 6.02% in the Northeast to a high of 7.62% in the Midwest. All regions, except the Mid-Atlantic, Midwest, Northeast, and Southeast, recorded a modest increase over the prior quarter. Average cap rates are up 132 basis points from the recent low of 5.60% recorded in the fourth quarter of 2022.

Private buyers accounted for 69% of single-tenant retail acquisitions through the fourth quarter of 2025, followed by REIT/Listed investors at 10% and institutional at 8%. The private share rose sharply by 11% from 2024, while institutional investment activity increased by 2%. REIT/Listed acquisitions fell from 26% of investment activity in 2024 to 10% as of year-end 2025.