The Europe & UK Opportunity

Valuation & Yield Advantage

  • 30–35% valuation discount: European equities trade at ~15x forward P/E versus ~22x in the U.S.

  • Higher income: Average dividend yields of ~3.0–3.5% in Europe & the UK vs. ~1.3–1.6% in the U.S.

  • Attractive real assets: European real estate and infrastructure often offer 150–300 bps yield premiums over comparable U.S. assets.

  • Mature markets: Rule-of-law jurisdictions, deep capital markets, and globally competitive exporters.

  • Hard-asset backing: Strong exposure to infrastructure, industrials, energy transition, and essential real assets.

Our view: The valuation gap is structural and unlikely to close quickly. For investors acting now, Europe and the UK offer access to high-quality cash flows and real assets at more compelling entry points than many U.S. opportunities.

Tailwind: Europe & UK vs. U.S.

Europe & UK

  • €1T+ committed through 2030

  • Direct public co-investment alongside private lenders

  • Long-dated, contract-backed policy frameworks

  • Coordinated EU + national programs

United States

  • Shorter policy horizons

  • Predominantly tax-credit–driven

  • Greater political and regulatory variability

  • Fragmented federal/state execution

What this means for private debt

  • Senior/core infrastructure debt:
    6–8% gross yields with strong cash-flow visibility and downside protection

  • Value-add/transition credit:
    8–11% gross yields, supported by subsidies, contracts, and regulated revenues

  • Structured/opportunistic credit:
    11–14%+ target returns, often with asset backing and public capital alignment

Bottom line: Europe and the UK offer policy-anchored cash flows with equity-like yields in parts of the private debt stack — a combination that is harder to find in the U.S. today.

U.S. vs. Europe / UK – 2024–2030 Trajectory

U.S Market Themes

  • Higher competition and pricing in many real assets and growth stories.

  • More capital chasing fewer large deals, especially in core markets.

  • Policy support exists, but is more fragmented and politically cyclical.

Europe & UK Market Themes to 2030

  • Structural need to invest heavily in energy, housing, and industrial upgrades.

  • Clear 2030 targets driving sustained spending and project pipelines.

  • More room for U.S.‑style operational excellence and scaling in under‑served segments.

Asymmetric Diversification

Europe and the UK provide diversification that is not just geographic, but structural and policy-driven. Through the EU Green Deal, REPowerEU, and national/UK programs, €800bn–€1T+ is being deployed toward the energy transition, infrastructure renewal, and strategic manufacturing through 2030.

  • €300bn+ earmarked under REPowerEU for energy security, grids, and renewables

  • €500bn+ under the EU Green Deal for climate, infrastructure, and industrial transition

  • Multi-year programs to 2030, reducing exposure to short-term political cycles

  • Lower correlation: European infrastructure and real-asset credit have historically shown ~0.3–0.5 correlation to U.S. credit markets

  • Downside protection: public subsidies, regulated revenues, and contracted cash flows support senior debt positions

Result: portfolio diversification with asymmetric risk-return — reduced correlation on the downside, with policy-backed cash flows supporting stable yields.