Jefferies, in its most recent Pan-European real estate note, positions Retail REITs as among the most attractively valued and operationally resilient corners of the property market as investors look toward 2026. The broker points to a combination of low vacancy, strong rental uplifts and improving investor interest as the reasons the sector may outpace broader real estate peers over the coming year.
Within the report, Jefferies singles out several listed retail landlords for particular attention, each for different reasons ranging from takeover optionality to defensive income characteristics.
Mery
Jefferies identifies Mery as a retail landlord with notable upside optionality. That view rests on two pillars set out in the note: first, the company’s solid operational fundamentals; and second, its positioning in a market that is beginning to shift back toward active investment. Crucially, Jefferies highlights that Mery lacks a controlling shareholder. The broker regards that corporate structure as increasing the firm’s vulnerability to potential takeover interest - a dynamic the broker treats as an additional element supporting the equity case for the company. In Jefferies’ view, attractive sector valuations combined with resilient asset income make Mery one of the more asymmetric investment ideas among European retail REITs.
Carmila
Carmila is noted for operational and financial complementarity with Mery. Jefferies underscores the complimentary nature of the two platforms, while stopping short of forecasting or calling for a formal transaction. The note explains the strategic rationale behind combining two large continental retail operators, pointing out that in an environment where investment activity is re-accelerating and valuations are still appealing, Carmila’s balance sheet strength and concentrated asset base could position it to benefit from a sector-wide pivot back into growth mode.
Eurocommercial Properties
Eurocommercial Properties is mentioned as another name that could draw corporate interest in a consolidating European retail landscape. Jefferies highlights the company’s strong implied yield of 7.3% as a salient valuation signal that could attract bidders under certain circumstances. The broker also notes the existence of a large shareholder with a relatively high entry price, which could dampen the immediacy of any take-over approach. Taken together, Jefferies presents Eurocommercial as offering dependable income, prime retail assets and valuation support at a time when retail fundamentals are on the mend.
Supermarket Income REIT
Among the broader roster of listed property companies covered in the note, Supermarket Income REIT stands out as the only entity explicitly classified in Jefferies’ detailed valuation table as a retail company. The broker highlights the REIT’s very high occupancy rate of 97%, a dividend yield of 5.8% and cash flows that are strong and asset-backed. Jefferies frames grocery-anchored real estate as a low-volatility segment that tends to collect rents consistently across cycles, and positions Supermarket Income REIT as a defensive, income-focused play for investors seeking retail exposure with limited volatility.
Overall, Jefferies’ note portrays a retail REIT market moving from stabilization into a phase where investment appetite is returning and valuations are sufficiently compelling to support further activity. While Jefferies flags specific strategic and valuation reasons to monitor Mery, Carmila, Eurocommercial Properties and Supermarket Income REIT, the central theme is one of improved fundamentals across retail assets as the sector heads into 2026.