Market Reports & Research Hub
Deep-dive quarterly analysis, transaction intelligence, and curated industry research
CRE Market Reports
Curated reports from the top CRE research firms - updated as new reports are published.
Key Findings - Q1 2026
H1 2026 NNN transaction volume reached $33.6B, tracking to set a full-year record of $67-70B, with 1031 exchange velocity and institutional rebalancing driving deal flow
Average single-tenant net lease cap rates expanded modestly to 6.55% in Q2 as 10-Year Treasury yields climbed above 4.50% on renewed CPI inflation from energy shocks
Fed holding at 3.50-3.75% with 8-4 dissent (April) and CPI surging to 4.2% YoY (May) creates uncertain H2 outlook — NNN spreads to Treasury have compressed to ~130 bps, tightest since 2023
H1 2026 Market Summary
H1 2026 NNN transaction volume reached $33.6B, tracking to beat 2025's full-year record of $66.8B. Q1 delivered $16.8B (up 12% YoY) before Treasury yields climbed sharply in Q2 as CPI re-accelerated from 2.4% in January to 4.2% in May on Middle East energy shocks. Cap rates have expanded modestly to 6.55% average, up from the Q1 trough of 6.45%. The Fed held at 3.50-3.75% with 8-4 dissent at the April meeting (strongest since 1992). NNN financing rates have risen to 5.80-6.30% as lenders reprice risk. Deal velocity remains strong as investors seek inflation-hedged NNN income with annual escalators.
| H1 2026 Transaction Volume | $33.6B |
| Average NNN Cap Rate | 6.55% |
| Cap Rate Change from Q1 Trough | +10 bps |
| NNN Financing Rate Range | 5.80–6.30% |
| 10-Year Treasury | 4.53% |
Cap Rate Compression by Tenant Category
Compression was not uniform across tenant categories. Premium QSR operators (McDonald's, Chick-fil-A) tightened fastest, now trading at 4.0–5.2% — a full 30 bps tighter than six months ago. Dollar stores (Dollar General, Dollar Tree) held steady at 6.75–7.25% as investors weighed unit-level economics. Auto parts retailers (O'Reilly, AutoZone) continued to attract strong demand at 5.5–6.0%. Pharmacy cap rates diverged sharply: CVS stabilized near 6.0% on healthcare services expansion while Walgreens widened to 7.0–7.5% on continued restructuring concerns. Medical office and urgent care NNN properties saw institutional interest grow with cap rates compressing to 5.5–6.0%.
| Premium QSR Cap Rate | 4.0–5.2% |
| Dollar Stores Cap Rate | 6.75–7.25% |
| Auto Parts Cap Rate | 5.5–6.0% |
| CVS Cap Rate | ~6.0% |
| Walgreens Cap Rate | 7.0–7.5% |
Geographic & Investor Trends
Tier-2 growth markets (Austin, Phoenix, Nashville, Charlotte) continued outperforming with $2.4B in quarterly volume, up 28% YoY. These markets offered 50–70 bps of cap rate spread versus Tier-1 metros, attracting 1031 exchange buyers and family offices seeking yield. Institutional capital re-entry was the major Q1 story — pension funds and insurance companies increased net lease allocations by an estimated 15% versus H2 2025. Private investors dominated the sub-$5M segment, representing 62% of transactions in that range. CMBS lending activity picked up with new issuance exceeding $28B in Q1, signaling improved debt market confidence.
| Tier-2 Market Q1 Volume | $2.4B |
| Tier-2 YoY Growth | +28% |
| Tier-2 vs Tier-1 Spread | 50–70 bps |
| Private Buyer Share (< $5M) | 62% |
| Q1 CMBS New Issuance | $28B+ |
2026 Outlook & Risk Factors
The forward outlook for NNN is constructive but not without risks. Positive leverage has returned for investment-grade acquisitions, and institutional re-entry suggests conviction in the asset class. However, tariff policy uncertainty and potential inflationary impacts could pressure the 10-Year Treasury back above 4.25%, stalling compression. Tenant credit quality remains a differentiator — investment-grade operators traded at 140+ bps tighter than non-investment-grade in Q1, and that spread is likely to widen if macro headwinds intensify. The pharmacy sector remains in flux with Walgreens store rationalization creating both risk and repositioning opportunities. Industrial logistics demand continues to benefit from nearshoring and e-commerce growth, though data center demand is increasingly competing for logistics-zoned land in key markets.
| IG vs Non-IG Cap Rate Spread | 140+ bps |
| Positive Leverage Threshold | ~6.0% cap rate |
| Key Risk | Tariff / inflation |
| Strongest Demand Sector | Industrial logistics |
| Most Volatile Sector | Pharmacy NNN |
Key Takeaways
Q1 2026 marks a turning point for the NNN market as cap rates compressed for the first time since the Fed's rate-hiking cycle began in 2022. The return of positive leverage and institutional capital re-entry signal broad confidence in the asset class heading into the second half of the year. Tier-2 growth markets continue to offer the best risk-adjusted returns for yield-oriented investors, while premium QSR and essential retail maintain the tightest pricing. Key risks to monitor include tariff-driven inflation, pharmacy sector restructuring, and the potential for Treasury rate volatility to slow the compression trend. The data supports a cautiously optimistic stance for net lease investors who can underwrite tenant credit quality and maintain discipline on entry pricing.
Never Miss a Report
Get new research and insights delivered weekly to your inbox
Research and analysis on this page are for informational purposes only and do not constitute investment, financial, or tax advice. Forward-looking projections are estimates based on current market conditions and may not reflect actual outcomes. Data should be verified with primary sources before use in investment decisions. Past performance does not guarantee future results.