Here's Why W.P. Carey Isn't Worried About This Giant New Competitor
One of the key differentiating factors behind W.P. Carey's (NYSE: WPC) business model is that it has a material presence in Europe. Historically, the net-lease competition in the region has been minimal. But Realty Income's (NYSE: O) increasing scale in Europe is changing that equation. Yet W.P. Carey believes the change will be a good one.
While the U.S. net-lease real estate market is fairly well developed, Europe is only beginning to embrace this style of property ownership in a big way. A net lease requires the tenant to pay most of the operating costs of the properties it occupies. Very often a net-lease transaction is a way for a tenant company to raise cash by selling a property without having to give up the use of that property, given that the company will often immediately sign a long-term lease, usually with built-in rent hikes.
Image source: Getty Images.
Source Fool.com
