Institutions and 5031’s have an appetite for acquisitions, according to one observer. The problem is debt.
Though sales of net lease properties fell in the first quarter, it wasn’t for lack of interest, according to Richard T. Murphy, senior vice president of the US Capital Markets Net Lease Group at Avison Young.
“A lot of the institutions are out there still looking for product,” Murphy says. “A lot of people raised a lot of money. There was a lot of money raised this year to go out and take down a lot of deals. That money’s still out there.”
What will change, according to Murphy, are return expectations. “But I still think that there’s still fairly healthy demand out there,” Murphy says.
The one issue for would-be buyers is debt. While apartment owners have Fannie Mae and Freddie Mac for liquidity, net lease landlords rely on banks.