The lag effect between elevated M&A activity and subsequent sale leaseback demand, a thesis the firm has advanced over recent quarters, found support in the first quarter of 2026, even as clear headwinds emerged. An energy driven inflation shock stemming from conflict in the Middle East pushed long-term rates meaningfully higher after a period of relative stability, weighing on the broader financing environment with uncertain duration. Even so, a flight toward fixed-cost debt instruments and firmer middle-market pricing, with purchase multiples and deal volume rising together for the first time in five quarters, sustained an attractive arbitrage between business and real estate multiples heading further into the year.
