Crisis Unleashes More Sale Leasebacks

PropertyEU - February 23, 2009

Europe's sale-and-leaseback market looks set to reach an historic peak this year as occupiers increasingly look to property sales to fund their core business. With lenders keeping a tight rein on credit, corporates are being forced to look for alternative sources of financing and real estate sales are high on every boardroom agenda, says John Wilson, head of EMEA Corporate Strategies at CBRE.

Wilson: 'We have never seen so much interest from the corporate community as today. The requests we are receiving from big corporations and financial institutions are two or three times the amount we saw last year. We are currently working on about EUR 3 bn worth of deals. But the key question is: how much equity is out there?'

The sale-and-leaseback market has grown strongly in Europe over the past years, reaching EUR 46 bn in 2007 from just EUR 6.7 bn three years earlier. While investment volume slumped by 50% in 2008, occupier sales remained an important source of activity, accounting for EUR 22.2 bn worth of deals. In absolute terms, this is down on 2007's volumes but in line with the drop in transactional activity across Europe. Sphere: Related Content