Realty Income has turned again to private capital markets to strengthen its funding base, this time aligning with Apollo Global Management in a $1 billion joint venture that underscores how large net-lease owners are broadening their sources of equity amid tightening public-market conditions.
Under the deal, Apollo-managed funds and affiliates will acquire a 49% interest in a new entity formed by Realty Income, which will hold roughly 500 single-tenant retail properties. Realty Income retains management control and operational oversight—an arrangement that preserves the REIT's steady cash-flow profile while introducing a major new capital partner. The transaction is expected to close on March 31, 2026.
For Realty Income, one of the sector's most active consolidators, the partnership continues a deliberate effort to create permanent channels to private capital. The company's executives described the Apollo transaction as a "programmatic" co-investing framework—one that could expand into multiple billions of dollars over time as opportunities and appetite align.
The initiative reflects a broader shift among large REITs toward complementing public equity issuance, which has grown more expensive in recent years due to rate volatility and investor selectivity. Realty Income has historically relied heavily on public markets to fund its acquisitions; its move toward hybrid financing structures marks a notable evolution in its capital strategy.
Chief Executive Sumit Roy said the partnership demonstrates the REIT's ability to attract scaled commitments through its operating platform, while tapping capital that is insulated from short-term market swings. The structure, according to Chief Financial Officer Jonathan Pong, carries permanent equity treatment from both Moody's and S&P—an important distinction for balance sheet integrity—and is expected to reduce the company's long-term cost of capital relative to issuing public stock.
For Apollo, the investment advances its aggressive expansion into real estate capital formation. Since 2020, the firm has originated more than $100 billion in customized funding solutions across sectors—from industrials and consumer goods to infrastructure and corporate real estate. Partner Joseph Jackson said Realty Income's long record of disciplined growth makes it a natural fit for Apollo's scaled capital model.
Advisers on the transaction include Goldman Sachs, which advised Realty Income, and Wells Fargo Securities, which advised Apollo.
If executed as planned, the partnership could serve as a model for REITs with deep operational capabilities but seeking steadier access to long-term equity. For Realty Income, it formalizes what many observers see as a maturing strategy: blending its "Monthly Dividend Company" identity with the flexibility of private institutional capital—an approach likely to gain traction as more REITs adapt to higher-for-longer interest rate conditions and constrained public market windows.
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