ATLANTA—Cap rates in the first quarter of 2015 for the single tenant net lease retail sector reached a new historic low of 6.40%. After holding steady for three straight quarters, cap rates for net lease retail properties declined by 10 basis points. That's according to The Boulder Group's latest report.

GlobeSt.com caught up with Jereme Snyder, executive vice president of Retail Services at Colliers International, to get his thoughts on the net leased market. In part one of this exclusive interview, he shares how the market has changed year-over-year, inventory concerns, and investor appetites for secondary, tertiary, class B and class C markets.

GlobeSt.com: How has the net lease market changed year-over-year?

Snyder: In short, not much. Transactional velocity has continued to be robust and demand for quality inventory of triple net properties remains high. If anything we have seen buyers' standards decrease and move to more secondary markets and also towards lesser tenant credit

GlobeSt.com: In terms of supply and demand, which way is the inventory leaning right now?

Snyder: Demand exceeds supply by a significant margin. There is a decent of inventory on the market but much of it is aggressively priced. I think this trend will continue for the foreseeable future.  

GlobeSt.com: Are investors looking to secondary and tertiary markets for good acquisitions?

Snyder: Yes. As supply of quality assets in primary markets dwindles, investment capital will "spill over" into secondary and tertiary markets in search of yield and inventory. This has resulted in notable cap rate compression for creditworthy tenants located in these markets. In additional this is where much of the new development is taking place. 

GlobeSt.com: Are investors grabbing class B and class C net leased assets?

Snyder: Although they garner less demand, Class B and C properties still remain popular relative to other investments due to going-in yields.  

Be sure to come back to this afternoon's Atlanta edition to find out where foreign investors fit into the net leased market. Snyder will also discuss the reality of bidding wars in part two of this series.