Realty Income and Apollo to Establish Strategic Partnership

Rhea-AI Summary

Realty Income (NYSE: O) and Apollo (NYSE: APO) announced a strategic partnership on March 19, 2026, under which Apollo-managed funds will invest $1.0 billion to acquire a 49% interest in a joint venture holding ~500 single-tenant U.S. retail properties. The portfolio shows $140 million cash annualized base rent and a 9.1-year weighted average remaining lease term as of Dec 31, 2025.

Realty Income will manage the assets, retain a call option (years 7–15) with a capped IRR of 6.875% for Apollo, and says rating agencies treated the investment as 100% permanent equity.

Positive

• $1.0B upfront equity from Apollo
• 49% JV stake finances ~500 retail assets
• $140M cash annualized base rent
• Permanent equity treatment by Moody's and S&P

Negative

• Capped Apollo IRR at 6.875% via future call pricing
• Only 28% of portfolio base rent is investment grade
• Low contractual growth: 1.0% CAGR

Key Figures

Initial Apollo investment: $1.0 billion Apollo JV equity stake: 49% Call option IRR cap: 6.875% +5 more

8 metrics

Initial Apollo investment $1.0 billion 49% equity interest in new U.S. retail joint venture portfolio

Apollo JV equity stake 49% Equity interest in joint venture owning single-tenant retail properties

Call option IRR cap 6.875% IRR cap used to calculate future call price in years 7–15

Cash annualized base rent $140 million JV portfolio cash annualized base rent as of Dec 31, 2025

Investment grade exposure 28% Share of portfolio base rent from investment grade tenants

Portfolio properties in JV ≈500 properties Number of U.S. single-tenant retail assets in joint venture

Weighted avg lease term 9.1 years Weighted average remaining lease term of JV portfolio

Apollo AUM $938 billion Assets under management as of Dec 31, 2025

Market Reality Check

Price: $60.95 Vol: Volume 6,766,742 is near ...

normal vol

$60.95 Last Close

Volume Volume 6,766,742 is near the 20-day average of 6,649,770 (relative volume 1.02x). normal

Technical Shares at $63.04 are trading above the 200-day MA ($59.23) and about 7.2% below the 52-week high.

Peers on Argus

O fell 1.64% with key retail REIT peers also down: SPG -0.56%, KIM -1.34%, REG -...

O fell 1.64% with key retail REIT peers also down: SPG -0.56%, KIM -1.34%, REG -1.25%, ADC -0.83%, NNN -1.25%, indicating broader REIT retail weakness.

Previous Partnership Reports

1 past event · Latest: Jan 12 (Positive)

Same Type Pattern 1 events

Date	Event	Sentiment	Move	Catalyst
Jan 12	Strategic partnership	Positive	+1.2%	Long-term GIC joint venture with >$1.5B commitments and Mexico portfolio entry.

Pattern Detected

The prior partnership announcement with GIC saw a modest positive move of about 1.24%, suggesting partnerships have been received constructively.

Recent Company History

Over recent months, Realty Income has highlighted steady dividend growth, solid 2025 results, and expansion of its private capital initiative. A key milestone was the Jan 12, 2026 strategic partnership with GIC, creating a programmatic joint venture with >$1.5 billion of combined commitments and a $200 million Mexico portfolio takeout. Today’s Apollo partnership continues that private capital strategy, again using joint ventures to fund long-duration net-lease assets while preserving balance sheet flexibility.

Historical Comparison

+1.2% avg move · In the past 6 months, O disclosed 1 major partnership (with GIC), averaging a 1.24% gain. The new Ap...

partnership

+1.2%

Average Historical Move partnership

In the past 6 months, O disclosed 1 major partnership (with GIC), averaging a 1.24% gain. The new Apollo JV extends this private-capital strategy into U.S. retail net-lease assets.

Partnership activity has progressed from a GIC-led industrial/logistics JV, including Mexico expansion, to an Apollo-backed U.S. retail net-lease JV, deepening Realty Income’s private capital platform.

Market Pulse Summary

This announcement details a strategic joint venture with Apollo featuring a $1.0 billion investment ...

Analysis

This announcement details a strategic joint venture with Apollo featuring a $1.0 billion investment for a 49% stake in roughly 500 U.S. net-lease retail properties. The portfolio carries $140 million of annualized base rent, a 9.1-year lease term, and 28% investment grade exposure. Together with the earlier GIC partnership, it underscores Realty Income’s private capital initiative. Investors may watch future tranche pricing, use of the call option, and portfolio performance under this framework.

Key Terms

net leases, call option, irr, investment grade, +1 more

5 terms

net leases financial

"single-tenant retail properties subject to long-term net leases."

Net leases are rental agreements where the tenant not only pays rent but also covers some or all property expenses such as taxes, insurance and maintenance, shifting ongoing costs away from the landlord. For investors, net leases are important because they typically produce steadier, more predictable income with lower landlord responsibilities—like collecting rent from a tenant who also pays the bills—but they can concentrate risk if the tenant vacates or defaults.

call option financial

"retain the right to exercise a call option to redeem Apollo's equity interest"

A call option is a contract that gives its buyer the right, but not the obligation, to buy a specific number of shares at a predetermined price within a set time period. Think of it as a refundable reservation to buy an item later at today’s price: you pay a fee up front and can profit if the stock rises, while your downside is limited to that fee; investors use calls to gain leverage, speculate on upside, or hedge positions without owning the shares.

irr financial

"future call price calculated to ensure a capped IRR of 6.875% to Apollo"

IRR (Internal Rate of Return) is the annualized percentage return an investment is expected to produce based on its projected series of cash outflows and inflows; mathematically, it’s the rate that makes the present value of those cash flows balance to zero. Investors use IRR to compare and rank projects or investments—similar to comparing the interest rates on savings accounts—to judge which offers the best return for the time and risk involved.

investment grade financial

"Investment grade exposure (as percentage of total portfolio base rent): 28%"

A credit rating label assigned to bonds or borrowers that signals relatively low risk of default; think of it as a strong health check for a company's or government's ability to repay debt. It matters to investors because investment-grade status typically means lower interest costs for the borrower, greater eligibility for conservative funds and pension portfolios, and generally more stable returns compared with higher-risk, non-investment-grade debt.

compound annual contractual growth rate financial

"Compound annual contractual growth rate: 1.0%"

Compound annual contractual growth rate measures how the value of revenues or obligations tied to signed contracts grows each year when gains are compounded, similar to how interest compounds in a savings account. Investors use it to gauge how quickly a company's booked, contract-backed business is expanding and how predictable future cash flows may be, so higher rates suggest stronger, more reliable top-line momentum and lower revenue uncertainty.

AI-generated analysis. Not financial advice.

- Funding Arrangement Will Advance Realty Income's Private Capital Initiative with Leading Asset Manager

- Initial Apollo Investment of $1.0 Billion for 49% Equity Interest in Portfolio of Existing U.S. Realty Income Retail Assets

- Cost-Efficient Long-Term Equity with 100% Permanent Equity Treatment by Rating Agencies

SAN DIEGO and NEW YORK, March 19, 2026 /PRNewswire/ -- Realty Income Corporation (Realty Income, NYSE: O), The Monthly Dividend Company^®, and Apollo (NYSE: APO) today announced that Apollo-managed funds and affiliates intend to provide a $1.0 billion investment to Realty Income to acquire a 49% interest in a new joint venture entity that is expected to own a diversified portfolio of single-tenant retail properties subject to long-term net leases. Realty Income will continue to manage the portfolio, which includes approximately 500 retail assets that benefit from stable, contractual cash flows and are supported by Realty Income's operating platform and long-standing asset management expertise.

"We are pleased to announce Apollo's targeted equity investment in a highly diversified, income-producing portfolio. As real estate partner to the world's leading companies^®, we expect this partnership will serve as a template for a multi-billion-dollar, programmatic co-investing relationship in the U.S. Our size, scale, and longstanding commitment to providing dependable monthly dividends to investors make this a natural fit with Apollo's insurance capital. Realty Income has demonstrated the ability to attract scaled commitments from partners looking to invest in our operating platform, and this new joint venture will further expand our access to efficient sources of private funding from one of the world's leading financial institutions," said Sumit Roy, Realty Income's President and Chief Executive Officer.

Apollo Partner Jamshid Ehsani said, "This transaction represents a landmark deal in the public REIT space. We believe the combination of Apollo's long-term capital with Realty Income's large, growing and diversified portfolio of high-quality net lease assets creates a highly complementary partnership. This partnership with Realty Income represents a programmatic framework for long-term alignment and repeatable capital deployment over time."

The joint venture represents a cornerstone component of Realty Income's private capital initiative, which is designed to diversify the Company's sources of capital and complement its access to the public equity markets. Realty Income expects the long-term partnership with Apollo to provide a scalable source of equity to support investment activity in long-duration, stabilized assets, while maintaining balance sheet strength and financial flexibility.

Realty Income CFO Jonathan Pong said, "This structured equity funding arrangement with Apollo is expected to unlock a source of meaningful savings relative to our long-term cost of public equity capital. Further, the cost of future tranches of this capital is expected to flex commensurate with long-term interest rates and will be priced independent of public markets, supporting a more stable source of equity. We are pleased that this structure has received permanent equity treatment by both Moody's and S&P."

Apollo Partner Joseph Jackson commented, "Realty Income is a leading global net lease real estate player with a long track record of disciplined growth and portfolio performance. Apollo's intention to make a substantial upfront and anticipated follow-on investments into Realty Income's high-quality assets demonstrates our ability to deliver differentiated capital solutions tailored to our partner's objectives."

Since 2020, Apollo has originated over $100 billion of bespoke capital solutions for leading companies such as Intel, Keurig Dr Pepper, Air France-KLM, BP, Sony, AB InBev, Vonovia and more.

The transaction is expected to close on March 31, 2026, subject to finalization and execution of the documentation, and customary closing conditions.

Goldman Sachs & Co. LLC acted as exclusive structuring agent and financial advisor to Realty Income, and Wells Fargo Securities served as financial advisor to Apollo.

Transaction Highlights

Under the terms of the transaction, Realty Income is expected to receive $1.0 billion of gross proceeds in exchange for Apollo's acquisition of a 49% interest in a joint venture that indirectly owns a diversified net lease portfolio comprised entirely of single-tenant retail properties. Realty Income will manage the properties under a long-term management agreement.

Realty Income will retain the right to exercise a call option to redeem Apollo's equity interest after year 7 and through year 15 of the joint venture, with the future call price calculated to ensure a capped IRR of 6.875% to Apollo during its ownership period.

Key portfolio metrics of the anticipated portfolio, as of December 31, 2025, are as follows:

Number of U.S. retail properties: ~500

Cash annualized base rent: $140 million

Weighted average remaining lease term: 9.1 years

Investment grade exposure (as percentage of total portfolio base rent): 28%

Compound annual contractual growth rate: 1.0%

Top five industries: Dollar Stores (9.9%), Quick Service Restaurants (8.3%), Drug Stores (7.9%), Grocery (7.7%), Health & Fitness (7.5%)

Portfolio metrics are subject to finalization and may change based on the final composition of the portfolio.

Realty Income has published an investor presentation providing additional information on this transaction, which can be found at www.realtyincome.com/investors/investor-presentation.

About Realty Income

Realty Income (NYSE: O), an S&P 500 company, is real estate partner to the world's leading companies^®. Founded in 1969, we serve our clients as a full-service real estate capital provider. As of December 31, 2025, we have a portfolio of over 15,500 properties in all 50 U.S. states, the U.K., and eight other countries in Europe. We are known as "The Monthly Dividend Company^®" and have a mission to invest in people and places to deliver dependable monthly dividends that increase over time. Since our founding, we have declared 669 consecutive monthly dividends and are a member of the S&P 500 Dividend Aristocrats^® index for having increased our dividend for over 31 consecutive years. Additional information about the company can be found at www.realtyincome.com.

About Apollo

Apollo is a high-growth, global alternative asset manager. In our asset management business, we seek to provide our clients excess return at every point along the risk-reward spectrum from investment grade credit to private equity. For more than three decades, our investing expertise across our fully integrated platform has served the financial return needs of our clients and provided businesses with innovative capital solutions for growth. Through Athene, our retirement services business, we specialize in helping clients achieve financial security by providing a suite of retirement savings products and acting as a solutions provider to institutions. Our patient, creative, and knowledgeable approach to investing aligns our clients, businesses we invest in, our employees, and the communities we impact, to expand opportunity and achieve positive outcomes. As of December 31, 2025, Apollo had approximately $938 billion of assets under management. To learn more, please visit www.apollo.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this press release, the words "estimate," "anticipate," "expect," "believe," "intend," "continue," "should," "may," "likely," "plans," and similar expressions are intended to identify forward-looking statements. Forward-looking statements include discussions of the joint venture with Apollo, including the execution and completion thereof, our ability to exercise the call right to redeem Apollo's equity interest in the joint venture and the call price payable therefor, entry into subsequent joint ventures on a programmatic basis, our business and portfolio including management thereof, and the intentions of management and dividends, including the amount, timing and payment of dividends related thereto. Forward-looking statements are subject to risks, uncertainties, and assumptions about us, which may cause our actual future results to differ materially from expected results. Some of the factors that could cause actual results to differ materially are, among others, our ability to execute and close the joint venture on the anticipated terms, or at all, our and the joint venture's financial performance; our continued qualification as a real estate investment trust; general domestic and foreign business, economic, or financial conditions; competition; fluctuating interest and currency rates; inflation and its impact on our clients and us; access to debt and equity capital markets and other sources of funding (including the terms and partners of such funding); volatility and uncertainty in the credit and financial markets; other risks inherent in the real estate business including our clients' solvency, client defaults under leases, increased client bankruptcies, potential liability relating to environmental matters, illiquidity of real estate investments (including rights of first refusal or rights of first offer), and potential damages from natural disasters; impairments in the value of our real estate assets; volatility and changes in domestic and foreign laws and the application, enforcement or interpretation thereof (including with respect to tax laws and rates); property ownership through co-investment ventures, funds, joint ventures, partnerships and other arrangements which, among other things, may transfer or limit our control of the underlying investments; epidemics or pandemics; the loss of key personnel; the outcome of any legal proceedings to which we are a party or which may occur in the future; acts of terrorism and war; the anticipated benefits from mergers, acquisitions, co-investment ventures, funds, joint ventures, partnerships, and other arrangements; and those additional risks and factors discussed in our reports filed with the U.S. Securities and Exchange Commission. Readers are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements are not guarantees of future plans and performance and speak only as of the date of this press release. Past operating results and performance are provided for informational purposes and are not a guarantee of future results. There can be no assurance that historical trends will continue. Actual plans and operating results may differ materially from what is expressed or forecasted in this press release and forecasts made in the forward-looking statements discussed in this press release may not materialize. We do not undertake any obligation to update forward-looking statements or publicly release the results of any forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

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SOURCE Realty Income Corporation

FAQ

What did Realty Income (O) announce on March 19, 2026 with Apollo (APO)?

They announced a joint venture where Apollo will invest $1.0 billion for a 49% interest in a retail property portfolio. According to the company, the JV will own ~500 single-tenant U.S. retail assets with Realty Income managing the portfolio.

How much rental income does the Realty Income–Apollo JV portfolio generate for O?

The anticipated portfolio produces $140 million of cash annualized base rent as of Dec 31, 2025. According to the company, this reflects contractual cash flows from long-term net leases across ~500 properties.

What is the lease duration profile of the JV portfolio for Realty Income (O)?

The portfolio has a weighted average remaining lease term of 9.1 years. According to the company, leases are long-duration net leases providing stable contractual cash flows for investors.

What are the investor protections and exit mechanics for Apollo in the O–APO JV?

Realty Income retains a call option exercisable after year 7 through year 15, with a call price capping Apollo's IRR at 6.875%. According to the company, this sets a defined exit framework and return cap for Apollo.

How did rating agencies treat the Apollo equity investment in Realty Income (O)?

Both Moody's and S&P provided 100% permanent equity treatment for the structure. According to the company, this classification supports Realty Income's balance sheet strength and financial flexibility.

What portfolio credit quality and growth metrics were disclosed for the JV with Apollo for O?

Investment grade exposure represented 28% of portfolio base rent and contractual growth was 1.0% CAGR as of Dec 31, 2025. According to the company, metrics are subject to finalization based on final portfolio composition.