Florida retail and net lease in 2026: the tightest market in commercial real estate, and the math most buyers get wrong
The retail apocalypse was supposed to end in an empty parking lot. In Florida, it ended with a waiting list for the parking lot. Vacancy is under 4%, rents keep climbing, and net lease is still the asset every 1031 buyer wants. But cap rates just hit a 10-year high, and borrowing now costs more than many deals yield. Here's how to tell a great Florida retail deal from an expensive one.
By Renan Serretiello and Christopher Taddei, founding partners of The List, Orlando, Florida. Part 7 of the Florida CRE series. Data through Q3 2026.
The 60-second answers
- How tight is Florida retail? Very. Statewide occupancy was 96.2% at midyear 2026, and vacancy has stayed below 4% every year since 2021.
- What are net lease cap rates right now? The average single-tenant net lease asked 6.92% in Q3 2026, a 10-year high. Retail averaged 6.69%; McDonald's and Chick-fil-A ground leases, about 4.50%.
- Should I use a loan? Run the math first. With the 10-year Treasury above 5%, financing often costs more than the cap rate, and debt lowers your return instead of raising it.
- What does Amendment 3 mean for retail? It passed. From 2027, non-school property taxes on commercial property can rise only 5% a year, and in a triple net lease the tenant usually captures that savings.
- Is Florida overbuilding? Worth watching. Florida has about 11% of U.S. retail space but got 26% of new supply in the first half of 2026.
- Are store closures getting worse? No. U.S. closures were down 44% at midyear 2026, and bankruptcies fell from 32 to 10.
Jump to the investor playbook · Run the NNN calculator · See the lease checklist
Every net lease buyer wants the same thing: a building that sends a check every month while somebody else fixes the roof. And every net lease buyer has the same quiet fear: buying the next closed pharmacy with eight years of payments still on the loan.
In Florida, the first part has rarely been easier to find, and the second part has rarely been more expensive to get wrong. This guide uses the latest Q3 2026 data to show where Florida retail stands, what the market is really paying for, and why the smartest buyers in the state are suddenly allergic to their lenders. It builds on the fall market report that opened this series, and borrows from the tax and insurance guides, because in a triple net lease, those are your tenant's problem until they become yours.
Florida retail: the tightest market in commercial real estate
Short answer: retail is the lowest-vacancy major property type in the country, [1] and Florida is tighter than the country.
Nationally, retail vacancy slipped to 4.3% in the third quarter of 2026, close to record lows. [2] Cushman & Wakefield's shopping center series put vacancy at 5.9%, well below its 7.4% historical average, as retailers backfilled stores others had vacated. [3] And the construction pipeline is tiny: about 0.3% of existing inventory nationwide at midyear. [4]
Florida runs tighter still. Colliers' 2026 State of Florida Retail report put statewide occupancy at 96.2%, with vacancy below 4% every year since 2021. Asking rents rose 2.1% over the year to an average of $35.17 per square foot, slightly ahead of the U.S. Florida retail sales grew 2.8% in the second quarter versus 2.6% nationally, and the state added nearly 197,000 residents in 2025 and a record 143.3 million visitors. [5]
The local numbers back it up. Miami-Dade asking rents hit a record $44.34 per square foot triple net in Q3, [6] Orlando asking rents averaged about $31 a foot triple net, [7] and Jacksonville posted a record $26.81, up 3.6%, with vacancy as low as 1.3% in some submarkets. [8]
Pick your vacancy rate
Short answer: Florida retail is tight by every measure, but how tight depends on who's counting.
Figure 1. Same market, same year, different vacancy rates (Orlando and Tampa retail vacancy as reported by different brokerages, 2026, %)
| Brokerage | Orlando | Tampa |
|---|---|---|
| Cushman & Wakefield (Q3 2026) | 3.9% | 3.8% |
| Avison Young (Q2 2026) | 4.2% | - |
| Lee & Associates (Q3 2026, Tampa Bay) | - | 4.38% |
| Colliers (Q2 2026) | 4.7% | 5.9% |
| Spread between reports | 80 bps | 210 bps |
| U.S. vacancy, for comparison (Colliers, Q3) | 4.3% | 4.3% |
Real data. Reports cover different quarters, geographies and property sets; the Lee & Associates figure covers Tampa Bay. Sources: Cushman & Wakefield; Avison Young; Colliers; Lee & Associates. [9] [10] [5] [11] [2]
Golden nugget #1: Tampa's retail vacancy is somewhere between 3.8% and 5.9%, depending on which report you read
Cushman & Wakefield said 3.8% in Q3. Lee & Associates said 4.38% for Tampa Bay. Colliers said 5.9% in Q2. That 210-basis-point spread is wide enough to make the same market look either scarce or comfortable. It's the same lesson we found with Miami office in part one: brokerages measure different inventories. Some include single-tenant buildings and malls, some don't. When a seller's offering memo quotes the lowest vacancy rate it could find, ask whose number it is, and compare it with the same source's figure from a year ago. The trend matters more than the level.
Sources: Cushman & Wakefield; Lee & Associates; Colliers. [9] [11] [5] See part one for the Miami office example.
The supply question nobody is asking loudly
Short answer: Florida is building retail far faster than the rest of the country. So far, demand has kept up.
Florida holds about 11% of the nation's retail space but accounted for 26% of new U.S. retail supply in the first half of 2026, with more than 8 million square feet still under construction at midyear. [5] Jacksonville delivered about 671,000 square feet over the past year, [8] and Orlando had about 1.2 million square feet under construction earlier this year. [12] Most of it is following rooftops: smaller, necessity-driven centers in growing residential communities, such as the Lake Nona West area in Orlando. [10]
That's the right kind of supply, and it's why Florida vacancy hasn't moved much. But it means the "no new supply" story that protects retail nationally doesn't fully apply here. In the fastest-growing submarkets we covered in part two, check what's being built within three miles before you pay a low cap rate for an older center.
What net lease costs right now
Short answer: net lease cap rates are the highest in more than a decade, and the market is paying up for credit and term while discounting everything else.
The Boulder Group's Q3 2026 report put the average single-tenant net lease asking cap rate at 6.92%, up 10 basis points in the quarter and the highest level in over a decade. Retail averaged 6.69%. The reason is simple: the Federal Reserve raised rates in September for the first time since 2023, and the 10-year Treasury climbed above 5.00% by the end of the quarter, its highest level since mid-2007. [13]
Figure 2. Credit and term set the price
Single-tenant net lease asking cap rates by sector, third quarter 2026. The 10-year Treasury was above 5.00% at the end of September.
| Sector | Asking cap rate, Q3 2026 |
|---|---|
| McDonald's and Chick-fil-A ground leases | 4.50% |
| Corporate quick-service restaurant | 5.90% |
| Auto parts and service | 6.47% |
| Corporate casual dining | 6.60% |
| All retail net lease | 6.69% |
| Franchisee quick-service restaurant | 6.87% |
| All single-tenant net lease | 6.92% |
| Dollar stores | 7.52% |
| Drug stores | 7.94% |
Real data. National asking cap rates; closed deals averaged about 25 basis points higher for retail. Source: The Boulder Group, Q3 2026 Net Lease Research Report. [13]
Two things jump out. First, credit is expensive to own and cheap to ignore: a corporate-guaranteed quick-service restaurant asked 5.90%, while the same kind of building backed by a franchisee asked 6.87%, nearly a full point more. [13] Second, the very best assets barely move. A 15-year McDonald's ground lease priced between 4.30% and 4.60% earlier this year, [14] which makes it the commercial real estate equivalent of a savings bond that sells fries.
Florida retail as a whole still prices richer than the country. CoStar data reported by Matthews put South Florida retail cap rates roughly 130 basis points below the 7.3% national average, Fort Lauderdale at 6.29%, and Jacksonville at 6.99%, up for 16 consecutive quarters. [15] [16] [8] For the Orlando metro, the average was 6.7% earlier this year. [12] Our Cap Rate Index tracks the local picture.
The negative leverage trap
Short answer: when your loan costs more than your cap rate, every dollar you borrow lowers your return.
Golden nugget #2: in 2026, the most powerful word in net lease is "cash"
Buy a $3 million property at a 6% cap rate and it produces $180,000 a year. Borrow 60%, $1.8 million, interest-only at 6.75%, and the interest alone is $121,500. Your $1.2 million of equity earns $58,500, a 4.9% cash return. Paying cash earns 6%. You took on a loan, a maturity date and a lender's covenants in exchange for a lower return. That's why the Boulder Group notes that permanent financing is generally priced above net lease cap rates right now, and that private capital and family offices are paying up for long-term credit while leveraged buyers get pickier. If you're a 1031 buyer with cash to place, this is your market. If you need a loan to make the numbers work, the numbers probably don't work.
Source for the financing and buyer trends: The Boulder Group. [13]
Figure 3. Above a 6% loan rate, borrowing makes a 6% cap rate deal worse (year-one cash-on-cash return, 6% cap rate purchase, 60% interest-only loan, %)
| Loan rate | Cash-on-cash with the loan | All-cash yield |
|---|---|---|
| 5.5% | 6.75% | 6.00% |
| 6.0% | 6.00% | 6.00% |
| 6.5% | 5.25% | 6.00% |
| 7.0% | 4.50% | 6.00% |
| 7.5% | 3.75% | 6.00% |
Our analysis. Illustrative. Year-one return only; ignores closing costs, amortization and rent growth. Leverage can still help over a full hold if rents grow or cap rates fall, which the calculator below lets you test.
Run the deal before you write the offer
Net lease deal calculator
The example is a $3 million property at a 6% cap rate with 1.5% annual rent growth, sold after 10 years at a 6.5% cap rate, financed 60% interest-only at 6.75%.
- All-cash yield, year one
- 6.00%
- Cash-on-cash with the loan
- 4.87%
- All-cash IRR
- 6.74%
- IRR with the loan
- 6.72%
Negative leverage: the loan is lowering your year-one return by 1.13 points.
Negative leverage: the loan is lowering your year-one return by 1.13 points.
Illustrative only. Interest-only loan, 2% selling costs at exit, no closing costs, reserves or taxes on the sale. Not investment advice.
Notice what the default example says: over 10 years, the loan adds almost nothing to the return (6.72% versus 6.74%) while adding all the risk of a loan. Drop the rate to 5% and the levered return jumps to about 9.2%. That's the whole bet a leveraged net lease buyer is making in 2026: that rates fall before the loan comes due.
Tenants, closures and the box after the tenant
Short answer: closures are slowing, value and convenience retailers are expanding, and in Florida the empty box usually refills.
2025 was rough: U.S. retailers announced 8,270 store closures, led by Rite Aid's 1,292 and Joann's 815. [17] 2026 has been calmer. Coresight tracked 3,321 closures at midyear, down 44% from 5,941 a year earlier, and just 10 retail bankruptcies versus 32. Openings slowed too, to 3,215, the lowest midyear count since 2020, as retailers expand more selectively. [18] Discount retailers are leading the openings. [17]
For a net lease buyer, the tenant's credit decides your cap rate, but the building decides your downside. Drug stores trade at the widest cap rates in Figure 2, 7.94%, for a reason: shrinking pharmacy chains are giving back boxes. [13] The question that matters is not "will this tenant stay?" It's "what is this box worth, and how fast does it refill, if they leave?" In Florida, with occupancy above 96%, the answer is usually better than it would be in a slower market. That's not a guarantee; it's a reason to underwrite the real estate, not just the logo.
A Florida favorite
The single-tenant building that sells gas, coffee and a breakfast sandwich to a fast-growing suburb is the closest thing net lease has to a Florida state bird. Convenience stores and auto service properties also benefit from the permanent restoration of 100% bonus depreciation, which the Boulder Group credits with keeping private buyers active. Talk to your CPA about cost segregation before you buy.
Bonus depreciation and private buyers: The Boulder Group. [13]
Amendment 3 passed. Here's what it means for retail.
Short answer: starting in 2027, non-school taxes on commercial property can rise only 5% a year instead of 10%. In a triple net lease, that mostly helps the tenant, which ends up helping the landlord too.
Florida voters approved Amendment 3 on November 3. Among other changes, it cuts the annual cap on assessment increases for non-homestead property, including commercial real estate, from 10% to 5% for non-school taxes, beginning January 1, 2027. School taxes are unchanged, and the Legislature and local governments will work out implementation details. [19]
Golden nugget #3: Florida retail tenants just got two occupancy-cost cuts in 15 months, and landlords should notice
In October 2025 the state eliminated its sales tax on commercial rent. Now Amendment 3 slows the growth of the non-school property taxes most triple net tenants pay. Lower total occupancy cost means healthier rent coverage, which means a tenant can afford the next base rent increase. For landlords, that's room in the renewal conversation. Two catches. The cap still resets to full market value when a property sells, so as we showed in part four, a buyer's tax bill can still jump the year after closing, and a lower cap makes the gap between a long-time owner's bill and a buyer's bill wider over time. And on gross or modified gross leases, the landlord, not the tenant, keeps the savings.
Rent tax repeal: Colliers via Florida Realtors. [5] See part four on the reset and our rent tax repeal guide.
The lease is the asset: what to check before you buy
In single-tenant retail, you're not really buying a building. You're buying a contract that happens to have a roof. Read it like one.
| Check | Why it matters |
|---|---|
| Remaining lease term | Less than about five years left and you're buying a re-leasing risk, priced at a higher cap rate for a reason |
| Rent increases | Flat leases lose value to inflation; bumps every year or every five years protect it |
| True NNN, or NN? | Who pays for the roof, structure and parking lot decides your real return |
| Who guarantees it | Corporate versus franchisee guaranty was worth nearly a full point of cap rate in Q3 2026 |
| Go-dark and termination rights | A tenant that can stop operating but keep paying can still hurt a center's co-tenants |
| Assignment and subletting | Who can the tenant hand the lease to, and is the original guarantor released? |
| Renewal options | Fixed-rent options can lock you below market in a rising-rent state like Florida |
| Tax and insurance pass-throughs | Confirm how the tenant reimburses the property tax reset and today's insurance premium |
| Florida rent tax language | Older leases may still reference sales tax on rent; it was repealed in October 2025 |
| Estoppel certificate | The tenant's written confirmation that the lease, the rent and the defaults are what the seller says |
General checklist, not legal advice. Have a Florida real estate attorney review the lease before you go hard on a deposit.
For the pass-throughs, our tax line worksheet rebuilds the post-sale property tax bill and our insurance renewal checklist covers the premium. Both are free and emailed to you.
For investors: the Florida retail playbook
Everything above, turned into decisions.
1. Buy with cash, or prove the debt pays
With financing generally priced above net lease cap rates, run every deal both ways in the calculator. If leverage only helps in a scenario where rates fall, treat that as speculation, not underwriting. [13]
2. Pay for credit and term on purpose
A corporate guaranty and 15 years of term buy you sleep. A franchisee guaranty and five years buy you yield. Both can be good deals; just know which one you're buying.
3. Underwrite the box, not just the logo
Ask what the building would rent for empty, how long it would take to backfill, and what it would cost to divide or re-tenant. In sub-4% vacancy markets the answer is often reassuring. In a submarket with heavy new supply, it may not be.
4. Use the vacancy data carefully
Compare the same source over time, ask what each brokerage counts, and walk the trade area. A 2-point spread between reports is a reason to do your own homework, not a reason to pick the most flattering number.
5. Price Amendment 3 and the rent tax repeal into renewals
Tenants' occupancy costs are falling. If you're a landlord with renewals coming, that's room for base rent. If you're a buyer, model the post-sale tax reset anyway.
6. Watch the trade area's pipeline
Florida is building 26% of the nation's new retail. Check new deliveries within three to five miles before paying a low cap rate for an older center. [5]
7. For development, look at Opportunity Zones
New retail and mixed-use development in a certified zone can pair Florida's strong demand with tax-free appreciation after 10 years. See part six, and remember the new Florida map takes effect January 1, 2027.
The bottom line for investors
Florida retail fundamentals are as good as they've been in a generation. Pricing has finally moved in buyers' favor. The only thing working against you is the cost of debt, and that's a problem cash solves.
Browse current listings, or tell us what you're looking for and we'll run the numbers with you before you make an offer.
The Florida CRE series
- Florida commercial real estate, fall 2026: what the numbers actually say
- Follow the rooftops: Florida's inland markets
- Florida's CRE debt reckoning: where the distress is, and isn't
- Florida commercial property taxes, explained
- Florida commercial property insurance in 2026
- Florida Opportunity Zones 2.0
- Florida retail and net lease in 2026 (you're here)
- Florida apartments in 2026
Frequently asked questions
What is the retail vacancy rate in Florida in 2026?
Colliers reported Florida retail occupancy of 96.2% at midyear 2026, with vacancy below 4% every year since 2021. Metro figures vary by source: in 2026 reports, Orlando ranged from 3.9% to 4.7% and Tampa from 3.8% to 5.9%, compared with a U.S. rate of about 4.3%.
What are net lease cap rates in 2026?
The Boulder Group reported an average single-tenant net lease asking cap rate of 6.92% in the third quarter of 2026, the highest in over a decade, with retail at 6.69%. By sector: corporate quick-service restaurants 5.90%, franchisee quick-service restaurants 6.87%, auto 6.47%, dollar stores 7.52% and drug stores 7.94%. McDonald's and Chick-fil-A ground leases asked about 4.50%.
What is negative leverage in net lease real estate?
Negative leverage happens when a loan's interest rate is higher than the property's cap rate, so borrowing lowers the investor's cash return instead of raising it. For example, a property bought at a 6% cap rate with 60% interest-only debt at 6.75% produces a year-one cash-on-cash return of about 4.9%, below the 6% an all-cash buyer earns.
How does Amendment 3 affect Florida retail and net lease properties?
Florida voters approved Amendment 3 in November 2026. Starting in 2027, it cuts the annual cap on assessment increases for non-homestead property, including commercial property, from 10% to 5% for non-school taxes. In triple net leases, tenants usually pay property taxes, so slower tax growth lowers their occupancy cost. The assessment still resets to market value when a property sells.
Is Florida overbuilding retail?
Florida holds about 11% of U.S. retail space but accounted for 26% of new U.S. retail supply in the first half of 2026, with more than 8 million square feet under construction, according to Colliers. Occupancy has stayed above 96%, but investors should check new deliveries submarket by submarket.
Are retail store closures slowing in 2026?
Yes. Coresight Research tracked 3,321 U.S. store closures at midyear 2026, down 44% from 5,941 a year earlier, and 10 retail bankruptcies versus 32. Store openings also slowed to 3,215, the lowest midyear count since 2020.
What should I check in a net lease before buying?
Remaining lease term, rent increases, who pays for roof, structure and parking, whether the guarantor is the corporation or a franchisee, go-dark and termination rights, assignment rights, renewal options, and how taxes and insurance pass through. In Florida, also confirm older leases no longer bill sales tax on rent after the October 2025 repeal.
Do I need a loan to buy a net lease property?
Not necessarily, and in late 2026 many buyers are paying cash. With the 10-year Treasury above 5% and permanent financing often priced above net lease cap rates, debt can reduce returns. Cash and 1031 exchange buyers, family offices and private investors are the most active buyers of long-term credit tenants.
This guide is for general information and education. It is not investment, tax or legal advice. Market data come from third-party brokerage research believed to be reliable but not independently verified, and figures differ by source because each measures a different inventory and period. Talk to qualified professionals about your situation before making a decision.
Buying or selling Florida retail?
Tell us the tenant, the term and the price. We'll show you what the market is paying, whether debt helps, and what the tax and insurance lines will look like after you close.