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STNL For-Sale Inventory Posts Big Jump in Q3

The single-tenant market experienced a remarkable quarter-over-quarter surge in supply during the third quarter, B+E reported. While Q2 ended with 3,286 properties listed on the market, that tally increased by nearly 19% to 3,905 during Q3. 

The increase in supply can be partially attributed to a significant influx of new listings, according to B+E’s Q3 cap rate report. 1,236 properties were brought to market in Q3, or 31.7% of the current supply.  

“New inventory is coming in twice as fast as it’s leaving the market,” the report states. From Q2 to Q3, 580 listings were either taken off the market or sold, less than half of new supply.  

“That being said, an alarming 15.3% of the current supply has been sitting on the market for over a year,” according to B+E. Of the properties that have been listed for more than a year, 43.7% have a cap rate below 5.50%. Among properties on the market for less than a year, just 27% have a cap rate lower than 5.50%.  

“Few properties are penciling at a 5.50% cap or lower, indicating challenges in finalizing transactions due to rising interest rates,” states the report. 

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