Bruce MacDonald, president of Boston, Mass.-based Net Lease Capital Advisors, a specialized investment and advisory firm focused on the net lease arena, says that his firm is looking at a lot of sale/leaseback deals these days.
   "It's a very competitive time with cap rates low, and interest rates rising," he says. "If a company is seeking to monetize its assets and wants liquidity, now is the time to do a sale/leaseback. Deals that we completed a year ago are getting lower cap rates, so some investment grade credits are cashing in."
   MacDonald says that the low cap rates are contributing to the market's highly competitive nature these days. A company, such as Net Lease Capital Advisors, must have a respected reputation and solid relationships with customers. Investors are turning to niche experts with existing relationships to source deals and with the expertise to efficiently underwrite corporate credit and real estate fundamentals.
   This highly competitive buying environment, combined with a low supply of quality net lease products, was a key driver in the recent joint venture between Net Lease Capital Advisors and and a major public pension fund advised by AEW Capital Management L.P. (AEW). Because of the joint venture, purchases will be made on a cash basis, allowing for rapid closings without financing contingencies. The venture is also able to accommodate tenants and developers with expansion rights and forward commitments on future developments.
   The first acquisition of the joint venture is a 250,000-sq.-ft. (23,225-sq.-m.) industrial building located in Gouldsboro, Pa., currently 10 percent leased to an S&P "A" credit-rated tenant.