Sales of unanchored retail strip centers over the 12 months ended March 31 declined 69% to $1.7B (billion). On a quarterly basis, sales of unanchored assets dropped more than 90% from a year ago. Sellers were willing to accept 91.8% of their asking price, down from what was achieved a year earlier. Sellers of anchored properties are faring slightly better, accepting 92.8% of the asking price, a sizable drop from what they accepted the previous year.

A more diverse tenant base has made unanchored strips more attractive to investors looking for opportunities. On a square foot basis, unanchored strips have benefited as average pricing has increased 11% to $220, while prices for anchored strips increased 3% to $189. Average caps rose in both unanchored and anchored strips, climbing 3 bps to 6.7% and 63 bps to 7.0%, respectively. The top 25% of unanchored strips are commanding near or above $400 PSF together with caps hovering around 6.3%.

Private investors dominated the buyer and seller composition landscape, representing 88% and 92% of the totals, respectively. The West had the largest regional volume, comprising 35% of the total with $597M in sales volume.