**Net Lease Cap Rates Continue to Stabilize in Q4 2025**
Cap rate stabilization in the single-tenant net lease sector continued into the fourth quarter of 2025, according to The Boulder Group’s Q4 2025 Net Lease Research Report. Overall cap rates crept up by just one basis point, reaching 6.81%.
Retail cap rates saw a slight compression, falling by two basis points to 6.55%. Office cap rates expanded to 8.00%, an increase of 10 basis points, while industrial cap rates remained steady at 7.20%.
“This is the third straight quarter of a single basis-point increase for cap rates,” said Randy Blankstein, President of The Boulder Group. “Cap rates were largely unaffected in 2025 despite multiple rate cuts in the second half of the year.”
Jimmy Goodman, partner at The Boulder Group, added, “The slight cap rate movement in the fourth quarter of 2025 illustrates continued pricing stability, supported by improving buyer-seller alignment following a period of more significant cap rate adjustment in prior years.”
The report also noted a strong performance in Q4 based on transaction volume. The single-tenant net lease market continues to attract both private and institutional buyers due to its predictable cash flow and relatively low risk.
Looking ahead, investor focus will remain fixed on monetary policy decisions. The Federal Open Market Committee showed signs of division at its December 2025 meeting. According to The Boulder Group, “If more cuts than expected occur, the single-tenant net lease market could experience significant tailwinds in the second half of 2026. However, lower interest rates will not explicitly mean lower cap rates going forward.”
