MarketSnapshot: Single-tenant retail

The single-tenant retail sector posted $3.1 billion in third-quarter sales volume, down 13.6% from the prior quarter but up 25.2% compared to the same period last year. Cap rates inched higher by 6 basis points on both a quarterly and annual basis, reaching 6.93%.

The West region led transaction activity, recording $722.7 million in volume and accounting for 23.1% of total volume. The Southeast followed with $698.4 million, representing 22.3% of overall volume. The Southwest ranked third with $622.1 million, or 19.8%, while the Northeast recorded $536.0 million, representing 17.1%. The Midwest contributed $351.3 million, or 11.2% of total volume. The Mid-Atlantic trailed all regions, accounting for 6.5% of transaction volume, or $204.4 million.

By region, cap rates ranged from a low of 6.52% in the West to a high of 7.73% in the Midwest. All regions, except the Southeast and Southwest, recorded increases from 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 66% of single -tenant retail acquisition volume through the third quarter of 2026, followed by REIT/Listed at 14% and cross-border at 9%. Domestic users/others made up 8%. Cross-border investment posted a sharp increase in activity, rising from just 1% of acquisition volume in 2024 and 4% in 2025. Institutional investors have been less active, accounting for just 3% year-to-date.