The appeal of European net lease to non-European investors

CONTRIBUTORS

Indraneel Karlekar

Global Head of Research & Strategy
Clarion Partners

Bruno Berretta

Head of Research, European Markets

Clarion Partners

Preview

The global uncertainty created by US tariff policy has unsettled financial markets and has cast a shadow on economic growth prospects. While the situation remains fluid with many moving parts, we believe that a corner of stability may be found in European commercial real estate, which has significantly repriced since market peaks in 2022, and where market fundamentals remain solid and macro-drivers broadly supportive. Defensive, income-oriented strategies—such as European net lease—can be especially interesting for non–European investors seeking stability, yield, and geographic diversification. This report sets out the rationale for that conviction.

Our conclusion

European net lease presents a compelling investment case for global investors seeking secure, inflation–resilient income in today’s fragmented and shifting macroeconomic landscape. With favourable yield spreads, structurally sound fundamentals, and inflation–linked rental streams, the strategy combines downside protection with long–term upside potential. While European net lease market complexity requires specialist expertise, it also creates inefficiencies from which well-positioned investors can benefit. In a world of growing divergence, European net lease offers a strong risk–adjusted investment opportunity for global real estate capital allocation.

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