Cap rates for stabilized and value-add retail properties increased across all segments during the second half of 2018, and professionals expect them to remain stable for the first half of this year, according to CBRE.
Demand for high-quality retail real estate remained strong, with stabilized cap rates for class-A properties across all three sectors — malls, neighborhood/community centers and power centers — ranging from 4.79 percent to 7.84 percent, CBRE reported in a North American survey.
Power center cap rates increased by an average of 13 basis points in the second half, to 8.42 percent, following a spate of store-closure announcements.
For the first half of this year, CBRE professionals anticipate that cap rates will remain unchanged for power centers and neighborhood/community center–stabilized properties alike, or else to rise by no more than 25 basis points, if that.
By Edmund Mander