Net Lease Investors Spend Big in the Inland Empire

Net lease investors are heading to the Inland Empire for opportunities. According to a recent report from CBRE, net lease investment volumes grew 105% last year in the Inland Empire, the second strongest gains in the country and a total of $3.2 billion. In 2018, net lease investment volumes totaled $1.5 billion.

“Development of commercial and residential projects ceased to exist after the Great Recession in 2008, while the market has been in a 10-year bull run and housing growth and demand for industrial real estate, particularly in the Inland Empire, have been incredible strong,” Ian Schroeder, an SVP at CBRE, tells GlobeSt.com. “So demand for this type of real estate has been very strong. We have seen a number of large net-leased industrial sales achieve record cap rates, which undoubtedly contributed to the region’s higher numbers, as well.”

The retail market has also helped to drive investment activity. “While the multi-tenant shopping center market has lagged the cap rates of single-tenant properties especially in non-core markets like the Inland Empire, owners are finding it accretive to break up their multi-retailer centers to maximize proceeds,” says Schroeder.