The UK pension industry is facing a deficit crisis caused by anaging population and low bond yields. In January, AON Consultingestimated 200 firms had shortfalls of about euro 53 billion ($64billion). Sale and leasebacks have become a viable means ofplugging this because of strong demand for real estate and lowinterest rates. The potential in sale-and-leaseback deals isconsiderable, Close Brothers says. The country's top 200 listedcompanies have freehold property assets with a net book value wellabove euro 145 billion ($174.59 billion).

The potential in property is underscored by new figures out thisweek from Investment Property Databank (IPD). This showed UKcommercial property returns rose by 1.4% in February and by 19.4%over 12 months.

Performance by commercial bricks-and-mortar compared withreturns in equities was up 1.2% and up just 0.1% in bonds, IPDsays. Returns are based on a mix of capital growth and income.Property delivered capital growth of 1%, compared to 0.9% capitalgrowth for equities and a fall of 1.6% for bonds, the IPD reportadds.