Deal timelines stretched through late 2023, as divergent value expectations, a challenging financing environment, and rising interest rates, including an October spike in the 10-year Treasury, weighed on both M&A and sale leaseback activity. Entering 2024, however, sentiment turned more constructive, with a pickup in new deal activity in late January pointing to a more conducive financing and M&A backdrop, supported by significant pent-up private equity dry powder. Middle-market business valuation multiples continued to soften year-over-year, keeping the arbitrage between business and real estate multiples healthy and sale leaseback opportunities attractive across a range of industry sectors.
