At first mention, the commercial real estate investment scene - conjuring images of Donald Trump flanked by a pack of murmuring lawyers - doesn't necessarily mesh well with the comparatively conservative, buy-and-hold world of private placements. Take the eagle-eyed due diligence and thirst for solid, long-term investments of the latter and add in the concrete, long-lived assets of the former, however, and you have a recipe for private buyside appetite.
The net-lease market has quietly been a staple for private placement buyers looking for added yield on quality, long-term paper since the two met, but the relationship became tenuous over the past two years as the Financial Accounting Standards Board (FASB) put special purpose, off-balance sheet vehicles under the regulatory microscope. Now that the seemingly incessant FASB fog has diminished into a mild haze - for this market, at least - the net-lease market should be looking at a fairly bright horizon. Factor in a groggy economy and its trickle-down ramifications for the capital markets climate, however, and the equation isn't quite so simple.