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Gas price volatility fuels deal focus on diversified fuel retail real estate
Bisnow reports cap rates in gas stations and convenience stores are among retail’s tightest, trading about 50 basis points above the 10-year Treasury yield.
Bisnow reports elevated and volatile gas prices, fueled by a supply shock tied to the war in Iran, have increased financial pressure for drivers even as many gas station investors remain active.
The outlet says that, rather than slowing, deal activity is being shaped by investors leaning on in-store revenue, using convenience retail as a hedge against fuel price uncertainty.
Bisnow cites MMGC Invest data indicating cap rates for the sector are about 50 basis points above the 10-year Treasury yield, and that top credit leases are pricing at or below the Treasury yield.
The article also notes that average convenience store cap rates are the tightest among 17 retail categories tracked by MMGC Invest, reflecting continued investor demand for fuel-centric locations with diversified sales.