When professionals in the real estate industry hear the term “1031,” they typically think of single tenant, triple-net leased properties. Drugstores. Restaurants. Banks. This certainly is a past and present trend, but compressing cap rates in these sectors have caused many private exchange buyers to look elsewhere for higher returns. The retail model with perhaps the highest uptick in recent demand has been the newly-constructed two to three tenant buildings, especially outparcels to larger shopping centers. Tenant categories many times include at least one, if not two, restaurants, and may include cellular phone stores, mattress, dental, and a host of other small format retailers. While cap rates for these properties can dip into the 5% cap rate range, by and large they have been trading between 6% and 6.75% depending on tenancy and market.