If anyone out there is still in any doubt that the US commercial investment sector is in recovery then news like this will make them fewer and farther between. GE Capital, General Electric's financial arm, has agreed to sell an $807 million portfolio of properties to American Realty Capital Properties, the Wall Street Journal reports.
The portfolio includes 471 lease properties, many of them leased to fast food restaurants such as Burger King and Wendy's, the paper says.
Considering an IPO for the capital arm, GE continues to shed assets from the unit, which was hard hit by the financial crisis.
Meanwhile, American Realty is on a buying spree. Last week it agreed to buy CapLease Inc. for $2.2 billion, including debt.
Of course American Realty aren't the only institutional investors in America on a buying spree. According to recent news nearly 50 Wall Street investment firms set real estate markets on fire over the past 18 months, spending up to $8 billion dollars buying up foreclosed properties by the bucket-load. However, according to a recent report by RadarLogic this is starting to turn as rising home prices dull yields.
The RadarLogic report found that the composite price per square foot paid by institutional investors in 25 of the largest metropolitan area housing markets increased 14.4 percent year over year in March. Over the same period, asking prices for rents have increased just 2.4 percent, according to Trulia, Inc. As a result, yields on single-family rentals are declining.