SLB Outlook: A Stronger Year Ahead

Corporate occupiers now recognize real estate as a risk asset, says Gastineau.

ATLANTA—Sale-leasebacks represented a healthy 21% of the overall net lease market last year, and while the overall dollar volume was off compared to the year prior, Stan Johnson Co. is expecting a stronger showing for SLBs in 2017. GlobeSt.com caught up with Shan Gastineau, Atlanta-based senior director with Stan Johnson, for his take on the outlook for this net lease sector.

GlobeSt.com: How  has the sale-leaseback market faired during the first two months of 2017 compared to the first two months of 2016?

Shan Gastineau: We probably could not have picked two recent periods for a more interesting comparison. The state of the market in early 2016 was this: from the first of the year until the end of February, the yield on the 10-year Treasury had dropped precipitously 52 basis points, the S&P 500 had dropped 179 points during the first six weeks and the debt market was stalling.  Deal flow and activity followed suit, slowing down to absorb the massive uncertainty. That the overall 2016 sale-leaseback sales volume ultimately was down from 2015 did not surprise us, considering how the year began and how the year ended.