Global Net Lease, Inc. (GNL) and Modiv Industrial, Inc, announced on Monday a definitive merger agreement under which GNL will acquire Modiv in an all-stock transaction valued at an enterprise value of approximately $535 million. The transaction, once completed, will provide GNL with an attractive portfolio of high-quality mission-critical industrial properties across the U.S. GNL intends to fully repay all of Modiv’s existing balance sheet debt and pay off Modiv’s preferred stock using its revolving credit facility and cash on hand.

“We believe this transaction is a compelling opportunity for GNL to expedite our transition to earnings growth in 2026 following the completion of our deleveraging initiative while continuing to reduce our office exposure,” said Michael Weil, CEO of GNL. “Modiv has thoughtfully assembled a high-quality portfolio of industrial net-lease assets that provide durable and predictable cash flows that align well with our objectives of enhancing earnings and long-term portfolio quality.”

Aaron Halfacre, president and CEO of Modiv, added, “We have long believed that our portfolio’s quality was historically mispriced by the marketplace and that we would be receptive if someone sought to close the value gap sooner than we could. Over the past year, Modiv attracted substantial interest from a range of suitors, including multiple unsolicited offers, but GNL distinguished itself through the long-term opportunity this transaction creates.”

Pictured: A Modiv-owned cold storage facility in Yuma, AZ.

For single-tenant net lease (STNL) retail in the second half of 2025, Colliers reported a steady but increasingly selective environment, shaped by cautious consumer spending, tariff pressures, elevated construction costs and tighter capital markets. Vacancy held near 4.3% and new supply was still constrained by high development and financing costs.

Sales volume increased to $6.5 billion, a 14% increase from H1 2025. with the drugstore sector alone up 49%. The median cap rate for sales compressed to 6.7%, down 10 basis points, while the median price per square foot fell to $294, 4.9% lower than in H1.

“Deal activity increasingly reflected a preference for smaller format retail assets because of necessity-oriented tenants and investors’ continued focus on liquidity, operational efficiency, and long-term income
durability within the STNL sector,” wrote Anjee Solanki, Colliers national director, Retail Services & Practice Groups | U.S., and Nicole Larson, senior manager, National Retail Research | U.S.

Global Net Lease, Inc. has entered into a binding agreement to sell its multi-tenant portfolio of 100 non-core properties to a subsidiary of RCG Ventures Holdings, LLC for approximately $1.8 billion at an 8.4% cash cap rate. The sale would accelerate GNL’s deleveraging initiative and position the company as a pure-play, single-tenant net lease company.

GNL launched its strategic disposition initiative in 2024 to significantly reduce debt, enhance financial flexibility and lower the cost of capital. Following completion of the multi-tenant portfolio sale, GNL expects to have completed nearly $3 billion in dispositions by the end of 2025.

“We believe the proposed sale of our multi-tenant portfolio is a strategic and prudent transaction that will bolster our balance sheet and position GNL for continued success,” said Michael Weil, CEO of GNL. “The proposed transaction greatly decreases operational complexities, G&A expenses and capital expenditures associated with multi-tenant retail properties.”

Pictured: Fountain Square in Brookfield, WI, among the multi-tenant properties GNL is selling.

Retail cap rates have increased across all sectors, with the dollar store and grocery sectors seeing rises of up to 23 and 19 basis points, respectively, B+E said in its latest net lease cap rate report. However, other sectors have experienced only minimal cap rate adjustments since the third quarter of 2024, with convenience stores remaining unchanged and QSR cap rates rising by just one bp.  

Since the end of August, there has been an increase in supply across all retail asset classes, the report stated. The casual dining, banking and convenience store sectors have experienced the largest supply increases, with rises of 21%, 20%, and 17%, respectively.

In contrast, the auto parts and pharmacy sectors saw the smallest growth in supply, with changes of 6% and 7%, respectively. Newly available listings make up 34% of the properties currently on the market. 

The industrial market has experienced a 28% increase in the number of available properties, with the distribution sector seeing a 27% rise. Major industrial players, such as FedEx, currently have 15 properties on the market, with an average cap rate of 6.55% and an average of 6 years remaining on the lease term. Among industrial property types, manufacturing facilities have seen the largest increase in cap rates, which have gone up 16 bps to 7.51% as of Q4. 

Among specialized property types, such as urgent care center and dialysis facilities, cap rates have compressed slightly since the end of Q3, according to B+E.

Cap rates in the single-tenant net lease sector continued to rise in the fourth quarter of 2024 for
the 11th consecutive quarter of increases across all three sectors, The Boulder Group reported. Single-tenant cap rates increased to 6.52% (up two basis points) for retail, 7.78% (up three bps) for office and 7.23% (up eight bps) for industrial.

“Sustained high interest rates and commentary from the Federal Reserve following the December meeting
continues to negatively impact the market,” said Randy Blankstein, president, The Boulder Group. “Overall cap rates rose to 6.76%, representing a three-bp increase from the previous quarter.”

Transaction velocity in 2024 remained significantly below the peak of 2021, yet Q4 experienced an uptick of investor activity. The spread between asking and closed cap rates remained flat or decreased for net lease properties.

“The bid-ask spread compression indicates a gradual alignment between buyer and seller expectations, something that was not experienced in early 2024,” said Boulder Group partner Jimmy Goodman. If transaction velocity continues, the supply backlog of net leased assets will decrease, the report stated.

The Boulder Group, a net-leased investment brokerage firm, completed the sale of a single-tenant P.F. Chang’s located at 2361 Fountain Square Drive in Lombard, Illinois, for $4,782,500.

Randy Blankstein and Jimmy Goodman of The Boulder Group represented the seller in the transaction. The seller was a Midwest-based real estate investor, and the buyer was a real estate investment trust. “P.F. Chang’s has operated from this location since 2000 and has demonstrated continued commitment,” said Randy Blankstein, President of The Boulder Group.

The 10,682-square-foot building benefits from its position off Butterfield Road, which is a dense retail thoroughfare positioned near Interstate 88. Tenants occupying the area include DICK’S, Target, The Home Depot, Costco, Chick-Fil-A, Starbucks, Ethan Allen, Uncle Julio’s, and many others. Additionally, P.F. Chang’s backs up to The Hyatt Place, Fountain Square Condominiums, and Sunrise Senior Living.

Jimmy Goodman of The Boulder Group added, “Strong-performing restaurants continue to garner interest so long as the asset has solid real estate fundamentals.”

Matthews Real Estate Investment Services structured a $55-million exchange on behalf of a client, facilitating the acquisition of 15 assets. Market leader Keegan Mulcahy and EVP Chad Kurz handled the transactions.

The client, a family-owned LLC, had recently sold a 700-acre farm, triggering the $55-million exchange requirement. The family aimed to reinvest the cash into net lease assets in high-growth markets throughout the U.S. Ultimately, 15 net lease investments were acquired across 12 states, with 85% of the investments being sourced off-market by Matthews. The acquisitions included quick service and fast casual restaurants, healthcare facilities, early education assets, multi-tenant retail sites and other verticals within the net lease universe.

“Market knowledge and product specialization were critical in executing our client’s requirement,” Mulcahy said. “By leveraging different tranches for diversification and balancing various return and risk thresholds for each property, we were able to complete the exchange requirement while also structuring our client’s desired return on their portfolio.”

Pictured, above: Keegan Mulcahy. Below: Chad Kurz.

Acquisition volumes among net lease REITs decreased modestly in the third quarter of 2024, as costs of capital remain volatile for most of the REITs, Green Street said in its latest report on the sector. Transaction volume was down 45% from Q3 2023 and down 50% from the same period two years ago.  

Although the net lease sector’s gross asset value premium averaged 13% in Q3, compared to 6% in the previous quarter, Green Street noted that this was skewed higher by outsized GAV premiums among two of the seven publicly traded REITs in the data and analytics firm’s coverage universe. “As such, most REITs are abiding by their weaker-than-normal cost of equity signal and acquiring less,” according to Green Street.  

Looking ahead, Green Street reported that most net lease REITs anticipate “a significant uptick in transaction volumes” in Q4 of this year and heading into 2025. 

Pictured: A Cooper’s Hawk Winery & Restaurant property in the Essential Properties Realty Trust portfolio.

Cap rates in the net lease sector continued to rise in the third quarter of 2024, albeit slightly, net lease brokerage The Boulder Group reported. The overall rise was three basis points quarter-over-quarter, with the average cap rate coming in at 6.73% in Q3.

All property types saw an uptick in cap rates, according to the Q3 report from The Boulder Group. Office sector net lease properties experienced the largest increase, at eight bps, with industrial up five basis points. Retail edged up three bps in Q3.

The onset of rising cap rates coincided with the Federal Reserve’s series of increases to the federal funds rate. “Additionally, there is a stagnant supply of net lease properties on the market resulting from limited transaction activity from both private and institutional buyers,” said Boulder Group president Randy Blankstein.

Current sellers of net lease properties hope the recent 50-bp cut in the federal funds rate will increase transaction velocity and potentially improve pricing in their favor. However, most market participants remain cautious and don’t expect cap rates to compress near-term unless there are continued rate cuts.

Cap rates in the single-tenant net lease sector increased for the ninth consecutive quarter within all three major property types, according to The Boulder Group’s 2nd Quarter Net Lease Research Report. Single-tenant cap rates increased to 6.47% (up five basis points) for retail, 7.67% (up seven bps) for office and 7.10% (up eight bps) for industrial.

“Elevated interest rates and limited 1031 exchange and institutional buyer activity is the cause of the consistent upward trend in cap rates,” said Randy Blankstein, president, The Boulder Group. “The lack of transactions when compared to recent years is causing property supply to rise without a path to clear the market inventory.”

With a significant number of properties on the market, most investors now believe the current market strongly favors buyers over sellers in terms of compromising on asset pricing. This applies especially to assets that are more highly commoditized, like dollar stores.

“With limited competition, buyers are targeting assets in either income-tax-free states or areas with strong demographic drivers,” said John Feeney, SVP, The Boulder Group. “Secondary buyer motivations include strong real estate fundamentals with credit tenants.”

In the second half of 2024, the pace of cap rate expansion should slow, according to the report. However, cap rates are still expected to rise, given the increase in the supply of net lease properties.