San Diego's net lease market is thriving. According to a reportfrom CBRE, San Diego led the nation inyear-over-year net lease investment volume gains. Office and retaildeals were integral to the market growth in 2019. Office salesincreased 2.5% and retail sales grew 2.4%. Overall, net leaseassets increased 110% year-over-year.

"San Diego is on sale compared to the rest of SouthernCalifornia, like L.A. and Orange County," MattPourcho, SVP at CBRE, tells GlobeSt.com. "If a deal is a6% cap rate in Los Angeles, it is a 6.5% to 6.75% cap rate in SanDiego. So, San Diego has been trading at a discount to Los Angelesand Orange County, meanwhile the fundamentals of San Diego areunbelievable. We have had new companies come here, and tech andlife science are expanding. If you are going to boil it down, thegrowth is really about fundamentals and yield."