SPONSORED: LaSalle — Real estate debt can be a steady craft for navigating a choppy market

Real estate debt gives a return boost to fixed-income investors, while offering a less risky option for real estate investors, both of which options are proving to be solid strategies in today’s uncertain capital market environment.

In an interview published in the June issue of Institutional Real Estate Americas, Glenn Sonnenberg, president and CEO of LaSalle Debt Inves­tors, discusses how economic trends are affecting this sector and how institutional investors might want to think about the opportunity real estate debt offers. “Equity depends upon appreciation for much of the return. Real estate debt is more conservative; it offers better positioning in the capital stack, and you have relatively low downside risk,” says Sonnenberg. “In a down market, debt historically outperforms equity. In a choppy market, debt historically outperforms equity. Only in a growing, appreciating market can equity outperform debt, but not on a current-income basis — only on