  Real-space renormalization approaches for quantum lattice systems generate
certain hierarchical classes of states that are subsumed by the multi-scale
entanglement renormalization ansatz (MERA). It is shown that, with the
exception of one spatial dimension, MERA states are actually finitely
correlated states, i.e., projected entangled pair states (PEPS) with a bond
dimension independent of the system size. Hence, real-space renormalization
generates states which can be encoded with local effective degrees of freedom,
and MERA states form an efficiently contractible class of PEPS that obey the
area law for the entanglement entropy. It is shown further that there exist
other efficiently contractible schemes violating the area law.
