Big Box Retail Cap Rates Volume and Pricing


Originally Published:
Monday, August 03, 2009


Over the past 12 months, big box property sales volume totaled over $460 million, a 63% year over year decrease. Sales for Q2’09 totaled only $29 million, a 90% decrease from Q2’08 and a 34% decrease from Q1’09. Big box properties represent 4% of all retail assets. Big-box retail property sellers have been achieving 94% of their asking price, and all other retail assets have been achieving only 91.5% of their asking price.

On a per-square-foot basis, average pricing for big box retail was down 6%, equal to the 6% decrease for all other retail properties. Cap rates for all retail properties are on the rise, with big box caps up by 54 basis points to 6.84% while other retail caps have increased by 65 bps to 7.15%. The top quartile of big box sales are commanding $154/sf at 6.4% caps while the bottom quartile of properties are trading for $94/sf at a 7.4% cap rate.

Private investors comprised the largest buyer group, acquiring 45% of big box properties on a dollar value basis, while REITs acquired 27% and users acquired 25% of all properties sold. Private buyers and users sold 43% of all properties over the past 12 months. The Southeast, with $216.5m in sales volume, was the only region to post over $100m in sales. Atlanta, with $60 million in sales volume for the past 12 months, was the market with the most activity.

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Based on independent reports of properties and portfolios $5 million and greater. Data believed to be accurate but not guaranteed.
 

Most Active

 NameVol.(bil)#props
1 Poly Real Esta...$8.846
2 Agile Property...$6.210
3 R&F Properties$6.19
4 China Overseas...$5.415
5 Shanghai Green...$5.327
6 Wheelock and C...$5.112
7 China Vanke Co...$4.836
8 Greentown Chin...$4.817
9 CapitaLand Lim...$4.246
10 Blackstone$4.117
deals reported closed in past 12 months valued at $10 mil. or greater
 
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