SPONSORED: Clarion Partners — Market conditions turn investors to defensive net-lease or sale-leasebacks strategies

Predictable returns driven by income, inflation protection and investment opportunities are some of the reasons to invest in net-lease commercial real estate in Europe right now, according to a report, The case for net lease and sale-leasebacks in Europe, by Clarion Partners’ Bruno Berretta, vice president, strategy and research, and Tim Wang, managing director and head of investment research.

Published in the May issue of Institutional Real Estate Americas, the report explains the long-term leases that undergird net-lease properties and the expectation that tenants pay property-related costs. “SLBs [sale-leasebacks] allow corporates to monetize 100 percent of the value of their real estate, eliminate refinancing risks and typically allow corporate sellers to retain operational control of the assets,” explain Berretta and Wang. “Furthermore, corporates tend to have a relatively higher cost of capital compared with real estate investment funds.