HedgeCo.Net — Realty Income and KKR announced on September 14 a new euro-denominated joint venture in which capital accounts advised by KKR intend to invest €528 million for a 49% equity interest, with Realty Income retaining 51% and continuing to manage the portfolio through its European operating platform, according to the companies’ PR Newswire release and Commercial Observer. The JV is expected to own a diversified portfolio of existing European net-lease assets contributed by Realty Income spanning four markets—Spain, Ireland, Poland, and the Netherlands—with 54 properties and an estimated year-1 cash NOI of €67.7 million as of June 30, 2026 metrics on the release.
The portfolio is being contributed at an effective 5.9% initial cap rate after recurring asset-management fees payable to Realty Income. Realty Income retains a call option to redeem KKR’s equity after year 10 through year 17, with a capped IRR to KKR expected between 6.3% and 6.5% set at closing. Close is targeted for September 30, 2026, subject to customary conditions. Lazard and DLA Piper advised Realty Income; Citi and Latham & Watkins advised KKR.
This is a signed private-capital JV, not a whole-portfolio sale. Mark the €528 million / 49% KKR stake, Realty’s 51% and management retention, the four-country 54-property perimeter, the 5.9% post-fee cap, the call/capped-IRR structure, and the Sep 30 close target as sourced. Do not invent leverage on the JV, tenant names beyond the top industry categories disclosed, or a programmatic follow-on size. The allocator object is permanent-equity private capital into stabilized European net lease beside a public REIT operator.