Total net lease transaction volume has increased 12.43% to $9.95 billion year-over-year, encompassing 1,077 transactions compared with 822 in the 12 months prior, according to a first-quarter market report from Newmark.
With the fourth quarter, that compares with a net lease transaction volume of $8.85 billion and 1,138 transactions.
The most active states, each with more than $250 million in volume for the first quarter, were California, New York, Florida, Georgia, Illinois, Arizona, Texas, North Carolina and Pennsylvania, Newmark said.
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Net lease’s share of total transaction volume was 21.2% on a rolling four-quarter basis, an increase of 0.44 percentage points from a year ago. Industrial accounted for about half of all net lease transaction volume, totaling $4.97 billion, up 22.72% from a year ago, followed by retail with $3.12 billion, up 38.76% and office with $1.86 billion, a decrease of 27.08%, according to the report.
Newmark said private investors have been the most active so far in 2025, accounting for 48.2% of acquisition and 49.1% of disposition volume. Institutions, including banks, insurance companies and retirement funds, accounted for 23.8% of acquisition and 17.9% of disposition volume, the report found.
Sale-leaseback volume jumped 69% to $1.84 billion for the first quarter and accounted for 15.22% of total net lease transaction volume on a four-quarter average. That represented a decrease of 0.19 percentage points year-over-year.
The report said average cap rates continued an upward trend but varied by asset type, with industrial coming in the lowest at 6.62%, followed by retail at 6.98% and office at 7.27%.
The average spread between blended net lease cap rates and the 10-year treasury in Q1 2025 was approximately 251 basis points, an increase of 75 basis points from Q1 2024, said Newmark.
The report highlighted noteworthy portfolio transactions, including SouthState Bank’s $459 million sale-leaseback encompassing 183 retail properties and Reddy Ice’s $134.7 million sale-leaseback of 59 industrial properties. The top industrial transaction was Burlington’s $257 million deal at March Air Reserve Base in California. The top retail transaction was Hy-Vee’s $19.8 million sale-leaseback in Omaha. The top office transaction was Live Nation’s $85 million deal in New York, according to the report.
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Kristen Smithberg
Kristen Smithberg is a Colorado-based freelance writer who covers commercial real estate, insurance, benefits and retirement topics for BenefitsPRO and other industry publications.
