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Circle K convenience store's front is pictured in Los Angeles, California, as Japanese 7-Eleven owner Seven & i Holdings considers going private to avoid a takeover by Canadian rival Alimentation Couche-Tard. This move comes after Couche-Tard proposed a $45 billion takeover bid. Oxford Economics previously identified a "window of opportunity" for commercial real estate investment in the next 12-18 months, citing Europe and industrial CRE as prime opportunities.

    However, data suggests that fast food and convenience store segments in the US offer attractive investment prospects. These retail types have low vacancy rates, with convenience stores and fast food having vacancies below 2%. In contrast, outlet centers and community/neighborhood centers have higher vacancy rates of over 5% and nearly 6%, respectively.

    Fast-food and convenience stores have been performing well, with consistent year-over-year visit growth outpacing overall retail. Convenience stores are transforming into destination locations through dining, shopping, and tourism offerings, driving customer interest and segment success. The industry's fragmentation in the US means that even large chains hold less than a fifth of market share, giving smaller chains more leverage in negotiations.

    Investor competition for properties net-leased to these tenants is increasing, driven by consumer demand and the scarcity of available space. Retail yields are attractive relative to risk-free returns, with rental growth reemerging in some markets after a multi-year absence. However, rising interest rates and economic uncertainty could impact demand and property profitability, making it essential for investors to consider entering the CRE market now.