KKR Invests €528 Million For 49% Stake In Realty Income European Joint Venture
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Realty Income and KKR have formed a new euro-denominated joint venture through which KKR-advised capital accounts will invest €528 million for a 49% equity interest in a portfolio of European net lease properties. Realty Income will retain a 51% interest in the venture and continue managing the portfolio through its European operating platform. The partnership expands Realty Income's private capital strategy into Europe after the real estate investment trust established a similar private capital model in the United States. The joint venture is expected to own a diversified portfolio of stabilized net lease assets across Spain, Ireland, Poland and the Netherlands. The anticipated portfolio includes 54 properties representing 140 units. As of June 30, 2026, the portfolio was expected to generate approximately €67.7 million of first-year cash annual net operating income. Its weighted average remaining lease term is approximately 7.2 years, while investment-grade tenants account for approximately 59% of total portfolio base rent. The portfolio is expected to have a 1.6% compound annual contractual growth rate. Its five largest industry and client categories are grocery, transportation services, home improvement, home furnishings and automotive parts. Realty Income is contributing the portfolio at an effective 5.9% initial capitalization rate after recurring asset management fees...
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