Allianz Real Estate has grown its European loan portfolio to €10.6 billion at year-end 2020, an increase of about 15% year-on-year, said the company.

The real estate investment subsidiary of the giant German insurer Allianz Group made €1.9 billion in new investments during the year, with capital deployed by its Luxembourg-based European Debt Fund Parec rising to more than €4 billion, an increase of one-third.

In total, the company’s European loan portfolio is now spread across 12 countries in the region, including a logistics transaction in the Czech Republic – a €185 million stake in a joint deal to refinance a logistics and industrial portfolio managed by CTP – which closed in December.

According to Roland Fuchs, Head of European Debt at Allianz Real Estate. “Despite the Covid 19 pandemic and related challenges in 2020, we were able to create attractive financing opportunities with improved risk-return profiles, resulting in our European credit business steadily growing in size and geographic footprint.” He said the company had both increased its assets under management, and had not experienced any defaults from its clients.

At the beginning of the year, even before the outbreak of the pandemic, Allianz’s European financing team had taken the strategic decision to increase the proportion of investments relating to renovation projects and development financing. The plan was to address investors’ growing appetite for ESG-focused loans while financing forward-looking offices – “centrally located, sustainably operated “smart” assets that focus on user experience and well-being with a range of value-added services,” as Allianz described it.

In May, Allianz Real Estate secured its first third-party client for its Luxembourg loan fund. Bayerische Versorgungskammer (BVK) took a €300m stake in a sub-fund with a total volume of €1.2 billion together with Allianz.

This led to a series of deals, including a €200 million “green loan” for the development of the Arboretum in Paris, the largest solid wood office complex in Europe. Further deals followed – to Helical in London, to Blackstone for two developments in Amsterdam, and €250m to Tishman Speyer for the Tour Cristal in Paris – all prime transactions, and increasingly structured as ‘green loans’ according to LMA standards.

With the classical bank lenders holding back from aggressively expanding their books, and largely restricting their lending to core and core-plus assets with a maximum of 55% loan-to-value, debt funds are enjoying a heyday right now, with several big players having recently launched their offerings on the European market.

Edmund de Rothschild has just closed on its debut fund, a €300m vehicle which is offering whole loans, mezzanine financing and preferred equity for both existing assets and project developments. Fund manager Ralf Kind told REFIRE that about a third of the fund was earmarked for German transactions. He said demand was so high, from both investors and potential borrowers, that he already had a pipeline of about €600m, so the start of the second fund is imminent.

According to René Höpfner, CEO at LaSalle Investment Management, the market volume in Europe of private debt funds has increased by three and a half times over the past ten years, since the introduction of stiffer lending and liquidity regulations for the banks in the wake of the financial crisis. This opened up a gap which debt funds have been increasingly filling. The COVID pandemic has basically just accelerated this trend, with non-banks now accounting for about 9-10% of European real estate financing, says Höpfner.

LaSalle Investment Management recently closed its first European debt fund (LREDS IV) Its first closing of €435m in commitments puts it on track for a total capital raise of €1bn, mainly from European and Asian pension funds and insurers. It is focusing on mezzanine debt and whole loans across all asset classes in Germany, the Netherlands, the UK, France and Spain.

Another new entrant in Europe is US giant Invesco, which recently took over the real estate financing business of Swiss asset manager GAM. Invesco managing director for Europe, Andy Rofe, said of the move, d “What we wanted to do was have the capability of investing in the real estate debt universe in Europe, which we didn’t have previously… (GAM) is a natural adjunct to the business. We have that full capability of public, private, equity and debt in the US, and wanted to complete that offering to clients in Europe as well.”

Also eyeing up the European market is London-based alternative asset manager Cheyne Capital, which is thought to be targeting up to €1.5bn for the latest in its eries of real estate debt funds. Cheyne is thought to have already raised Stg500m in a first close for series VI and VII of its CRECH suite of funds (Cheyne Real Estate Credit Holdings).

Cheyne too targets gaps in the market left by the withdrawal of traditional debt providers. It is currently focused on borrowers requiring finance for value-add, transitional or development projects, mainly in the UK, France and Germany. With debt for these assets currently in short supply, Cheyne believes it can get strong risk-returns from senior lending where it will have first charge over the property, although it is able to lend higher up the capital stack. It has already made loans on its new debt series – two in the UK and one each in France and Spain.

In Germany, Helaba Invest has also just raised €150m for its Multi-Manager Spezialfonds, which will invest in senior whole loans and mezzanine products. It expects to participate in between 100 and 150 separate financings over its scheduled eight year duration, and is targeting a return after costs of 6% – 8%.

It certainly looks as if the European market for debt finance is set for a lot of further growth. The advantages for borrowers are the perceived speed of decisions, flexibility and certainty of execution, while premature repayments are less expensive than with banks, along with greater clarity on necessary capital expenditure.

Investors in debt funds gain from attractive risk-return profiles, with yields of 3-4% on senior lending with 60% LTVs. On 60-75% LTVs, gross yields can be as high as 7-10%, as well as giving them the extra cushion of the investors’ own equity capital ahead of them in the capital stack.

Additionally, for insurance companies and pension funds, their investments are treated more favourably under Solvency I and II regulations than would be their direct investments. Hence the BVK’s decision to partner up with Allianz (see above), which will see it taking a quarter of the loans issued by Allianz. These will be issued with LTVs of between 50% and 60% across Europe, with a target return of 2.25-2.5%, reflecting the core-nature of the targeted assets.

Higher returns are available in mezzanine funds, such as those of Corestate subsidiary HFS, which are offering up to 10% in its €1.3bn property development fund which only provides mezzanine tranches on 90% LTVs – a market much in demand in these corona-ridden times. The HFS fund is expected to expand into offering whole loans this year.

A deal has been agreed for £32m of funding for a 144-apartment scheme in Manchester – with a third of units allocated to local keyworkers.

Real estate investor Cheyne Capital and North West developer Mulbury announced the forward funding deal for the project on Oldham Road in New Cross.

Once complete, 35% of homes at the 12-storey development will be for nurses, teachers and emergency service workers at discounted rents.

It will comprise one, two and three bedroom apartments and work, entertainment and relaxation spaces, ground floor retail facilities, and a 3,000 sq ft roof terrace providing outside space for residents.

Stuart Fiertz, Cheyne Capital’s co-founder and head of responsible investment, said: “As cities expand, it is too often the case that keyworkers get priced out of the central housing market and forced to either downsize or move to less accessible areas.

“We are therefore committed to delivering high quality homes in desirable locations – and to ensuring that they remain affordable now and into the future.

“Mulbury has an excellent track record of delivering high-quality housing in Manchester and we look forward to working together to help address the UK’s severe shortage of inclusive, affordable housing.”

The site is currently occupied by outdated industrial buildings and a small surface level car park.

Mulbury said it hopes to start demolition and remediation work on the site in February 2021. It is expected that the building will be completed by summer 2023.

The building has been designed by Manchester-based Tim Groom Architects and Mulbury has also appointed locally-based YOUTH Studio as interior designer for the project.

Deloitte Real Estate acted as planning consultant and CBRE advised Mulbury on the transaction.

Beyond Corporate provided legal advice to Mulbury on the funding with Cheyne Capital, while Primas Law acted as legal advisor on the site acquisition and assembly.

GMI Construction has been appointed as main contractor.

Martin Bury, co-founder and director at Mulbury, added: “Cheyne’s social impact values are aligned with our own vision for providing choice and affordability in the Manchester housing market.

“We’re delighted to have secured the forward funding to make this development a reality. The standard of the design and the quality of the accommodation on offer will provide an iconic new building and support the ongoing renewal of residential accommodation within New Cross.”

Impact real estate investor Cheyne Capital and North West housing developer Mulbury have announced a £32m forward funding deal to build 144 apartments in Manchester’s New Cross neighbourhood.

The investment comes from Cheyne’s second Impact Real Estate Fund and includes a social covenant to ensure that more than a third (35%) of the homes will be allocated to local keyworkers, such as nurses, teachers and emergency services workers, at discounted rents.

The 12-storey development, to be built on Oldham Road, will include one-, two- and three-bedroom apartments and will also comprise work, entertainment and relaxation spaces, ground floor retail facilities, and a 3,000 sq ft roof terrace providing outside space for residents.

Stuart Fiertz, Cheyne Capital’s co-founder and head of responsible investment, said: “As cities expand, it is too often the case that keyworkers get priced out of the central housing market and forced to either downsize or move to less accessible areas.

“We are, therefore, committed to delivering high quality homes in desirable locations – and to ensuring that they remain affordable now and into the future.

“Mulbury has an excellent track record of delivering high quality housing in Manchester and we look forward to working together to help address the UK’s severe shortage of inclusive, affordable housing.”

Martin Bury, co-founder and director at Mulbury, said: “Cheyne’s social impact values are aligned with our own vision for providing choice and affordability in the Manchester housing market.

“We’re delighted to have secured the forward funding to make this development a reality. The standard of the design and the quality of the accommodation on offer will provide an iconic new building and support the ongoing renewal of residential accommodation within New Cross.”

The 0.13-hectare development site sits within the New Cross Neighbourhood Development Framework, a key gateway into Manchester city centre from the North. It is bounded by Oldham Road, Addington Street, Marshall Street and Chadderton Street, and is currently occupied by outdated industrial buildings and a small surface level car park.

Mulbury hopes to start demolition and remediation work on the site in February. It is expected that the building will be completed by Summer 2023.

Mulbury has also gained planning consent for two further residential-led developments in New Cross – one in Goulden Street and the other in Bendix Street.

The Oldham Road development marks the latest investment from Cheyne’s second impact fund. The previous investment was in housing for adults with a learning disability.

Diversification by tenant type, counterparty and location is a key element of Cheyne’s strategy. Investments in the first impact fund were a mix of acquired and developed assets for use as affordable, keyworker and temporary housing and accommodation for social care by local authorities, housing associations and charities.

The building has been designed by Manchester-based Tim Groom Architects and Mulbury has also appointed locally-based Youth Studio as interior designer for the project.

Deloitte Real Estate acted as planning consultant and CBRE advised Mulbury on the transaction. Beyond Corporate provided legal advice to Mulbury on the funding with Cheyne Capital, while Primas Law acted as legal advisor on the site acquisition and assembly.

GMI Construction has been appointed as main contractor. Other members of the project team include Scott Hughes Design as structural and civil engineer, RLB as cost consultant, Futureserv as M&E consultant, Gray Scanlan Hill as right to light advisor, Layer as landscape consultant, dBx Acoustics as acoustics advisor, SK Transport as transport consultant, BB7 as fire engineer, and Rawlings as principal designer.

Investor Cheyne Capital Real Estate will forward fund the developer’s 144-apartment scheme on Oldham Road in Manchester to the tune of £32m.

Under the terms of the agreement, 35% of the homes will be reserved for local key workers, such as nurses, teachers and emergency services workers, at discounted rents.

The investment comes from London-based Cheyne Capital’s Impact Real Estate Fund, set up to help tackle the UK’s shortage of affordable housing.

Cheyne Capital’s investment will pay for the construction of the project and the investor will take ownership of the scheme once complete.

CBRE advised Mulbury on the transaction while Beyond Corporate provided legal advice.

Mulbury’s 12-storey development, to be built by contractor GMI Construction, will include one-, two- and three-bedroom apartments and will also comprise work, entertainment and relaxation spaces, ground floor retail facilities, and a 3,000 sq ft roof terrace.

Stuart Fiertz, Cheyne Capital’s co-founder and head of responsible investment, said: “As cities expand, keyworkers often get priced out of the central housing market and forced to either downsize or move to less accessible areas. We are committed to delivering homes in desirable locations and ensuring that they remain affordable now and into the future.

“Mulbury has an excellent track record of delivering high-quality housing in Manchester and we look forward to working together to help address the UK’s severe shortage of inclusive, affordable housing.”

Martin Bury, co-founder and director at Mulbury, added: “Cheyne’s social impact values are aligned with our own vision for providing choice and affordability in the Manchester housing market.”

The site is bounded by Oldham Road, Addington Street, Marshall Street and Chadderton Street, and is currently occupied by industrial buildings, which will be demolished under Mulbury’s plans.

Work on the project, which sits within Manchester’s burgeoning New Cross neighbourhood, will begin in February and complete in summer 2023, according to the developer.

Mulbury has also gained planning consent for two further residential-led developments in New Cross; 73 apartments on Goulden Street and a 161-unit scheme on Bendix Street.

All three of Mulbury’s New Cross schemes were designed by Tim Groom Architects.

Mulbury has appointed YOUTH Studio as the interior designer for the Oldham Road project having worked with the firm on its Excelsior Works development in Castlefield.

Deloitte Real Estate acted as the planning consultant, while Primas Law acted as legal advisor on the site acquisition and assembly.

Other members of the project team include Scott Hughes Design as the structural and civil engineer, RLB as the cost consultant and Futureserv as M&E consultant.

Gray Scanlan Hill is the ‘right to light’ advisor for the scheme, Layer.studio is the landscape consultant, dBx Acoustics is the acoustics advisor and SK Transport is the transport consultant.

BB7 is the fire engineer and Rawlings is the principal designer.

Impact real estate investor Cheyne Capital and North West housing developer Mulbury have confirmed a £32m forward funding deal to finance the building of 144 apartments in Manchester.

The investment comes from Cheyne fund’s second Impact Real Estate Fund and includes a stipulation that 35% of the homes will be allocated to local keyworkers.

The 12-storey development is located on Oldham Road in Manchester’s New Cross neighbourhood and will include one, two and three-bed apartments as well as ground floor retail space and a 3,000 sq ft terrace for residents.

Demolition and remediation work is expected to start on the site next month, with the building completed by summer 2023. Mulberry has also gained planning consent for two further residential-led developments in New Cross, on Goulden Street and Bendix Street.

Stuart Fiertz, co-founder and head of responsible investment, Cheyne Capital, said: “As cities expand, it is too often the case that keyworkers get priced out of the central housing market and forced to either downsize or move to less accessible areas. We are therefore committed to delivering high quality homes in desirable locations – and to ensuring that they remain affordable now and into the future.

“Mulbury has an excellent track record of delivering high-quality housing in Manchester and we look forward to working together to help address the UK’s severe shortage of inclusive, affordable housing.”

Martin Bury, co-founder and director, Mulbury, added: “Cheyne’s social impact values are aligned with our own vision for providing choice and affordability in the Manchester housing market.

“We’re delighted to have secured the forward funding to make this development a reality. The standard of the design and the quality of the accommodation on offer will provide an iconic new building and support the ongoing renewal of residential accommodation within New Cross.”

Cheyne Capital and North West housing developer Mulbury have agreed a £32m forward funding deal for 144 flats in Manchester’s New Cross neighbourhood.

The investment comes from Cheyne fund’s second Impact Real Estate Fund and includes a social covenant to ensure that 35% of the homes will be allocated to local key workers, such as nurses, teachers and emergency services workers, at discounted rents.

The 12-storey development, to be built on Oldham Road, will include one, two and three-bedroom flats and will also comprise work, entertainment and relaxation spaces, ground-floor retail facilities, and a 3,000 sq ft roof terrace.

Stuart Fiertz, Cheyne Capital’s co-founder and head of responsible investment, said: “As cities expand, it is too often the case that key workers get priced out of the central housing market and forced to either downsize or move to less accessible areas. We are therefore committed to delivering high-quality homes in desirable locations – and to ensuring that they remain affordable now and into the future.”

The 0.3-acre development site sits within the New Cross Neighbourhood Development Framework, a gateway into Manchester City Centre from the north. It is bounded by Oldham Road, Addington Street, Marshall Street and Chadderton Street, and is currently occupied by outdated industrial buildings and a small surface-level car park.

Mulbury hopes to start demolition and remediation work on the site in February, with completion scheduled for summer 2023.

CBRE advised Mulbury.

Impact real estate investor Cheyne Capital and North West housing developer Mulbury have announced a GBP32 million forward funding deal to build 144 apartments in Manchester’s New Cross neighbourhood.

The investment comes from Cheyne’s second Impact Real Estate Fund and includes a social covenant to ensure that more than a third (35 per cent) of the homes will be allocated to local keyworkers, such as nurses, teachers and emergency services workers, at discounted rents.

The 12-storey development, to be built on Oldham Road, will include one, two and three bedroom apartments and will also comprise work, entertainment and relaxation spaces, ground floor retail facilities, and a 3,000 sq ft roof terrace providing outside space for residents.

Stuart Fiertz, Cheyne Capital’s Co-Founder and Head of Responsible Investment, says: “As cities expand, it is too often the case that keyworkers get priced out of the central housing market and forced to either downsize or move to less accessible areas. We are therefore committed to delivering high quality homes in desirable locations – and to ensuring that they remain affordable now and into the future.

“Mulbury has an excellent track record of delivering high-quality housing in Manchester and we look forward to working together to help address the UK’s severe shortage of inclusive, affordable housing.”

Martin Bury, Co-Founder and Director at Mulbury, adds: “Cheyne’s social impact values are aligned with our own vision for providing choice and affordability in the Manchester housing market.

“We’re delighted to have secured the forward funding to make this development a reality. The standard of the design and the quality of the accommodation on offer will provide an iconic new building and support the ongoing renewal of residential accommodation within New Cross.”

The 0.13-hectare development site sits within the New Cross Neighbourhood Development Framework, a key gateway into Manchester City Centre from the north. It is bounded by Oldham Road, Addington Street, Marshall Street and Chadderton Street, and is currently occupied by outdated industrial buildings and a small surface level car park.

Mulbury hopes to start demolition and remediation work on the site in February 2021. It is expected that the building will be completed by summer 2023. Mulbury has also gained planning consent for two further residential-led developments in New Cross – one in Goulden Street and the other in Bendix Street.

The Oldham Road development marks the latest investment from Cheyne’s second impact fund. The previous investment was in housing for adults with a learning disability. Diversification by tenant type, counterparty and location is a key element of Cheyne’s strategy. Investments in the first impact fund were a mix of acquired and developed assets for use as affordable, keyworker and temporary housing and accommodation for social care by local authorities, housing associations and charities.

Cheyne Capital’s second UK Impact Real Estate Fund is investing £32m (€36m) to fund the development of homes with developer Mulbury.

The duo have partnered to build 144 apartments in Manchester’s New Cross neighbourhood. The 12-storey development, to be built on Oldham Road, will include one, two and three-bedroom apartments.

Mulbury expects to start demolition and remediation work on the site next month. It is expected that the building will be completed by summer 2023.

Stuart Fiertz, Cheyne Capital’s co-founder and head of responsible investment, said: “As cities expand, it is too often the case that keyworkers get priced out of the central housing market and forced to either downsize or move to less accessible areas.

“We are therefore committed to delivering high-quality homes in desirable locations – and to ensure that they remain affordable now and into the future.

“Mulbury has an excellent track record of delivering high-quality housing in Manchester and we look forward to working together to help address the UK’s severe shortage of inclusive, affordable housing.”

Martin Bury, co-founder and director at Mulbury, said: “Cheyne’s social impact values are aligned with our own vision for providing choice and affordability in the Manchester housing market.

“We’re delighted to have secured the forward funding to make this development a reality. The standard of the design and the quality of the accommodation on offer will provide an iconic new building and support the ongoing renewal of residential accommodation within New Cross.”

At the end of the 2019-2020 financial year, MND Group achieved a consolidated turnover of 40.3 million euros (47.8 million euros over the same 12-month period of the previous fiscal year), i.e. a decline of -16%.

MND had to deal with the Covid-19 pandemic and its health consequences during the second half of the year, with the implementation of restrictive measures (closure of ski resorts) in many countries. Faced with this situation, MND has adapted its activity from the end of January 2020 in China, then in March in Europe and the United States, by partially closing its various production sites, and by interrupting its deliveries. and installations in consultation with customers.

Following the deconfinement, the group operated in May 2020 the gradual restart of its production sites, with a return to full capacity since the end of June 2020.

The gross margin is 6.6 ME for an adjusted EBITDA of -31.9 ME. The net result is a loss of -57.8 ME (-57.4 ME pro forma 2018-2019).

Beyond the health and economic consequences linked to Covid-19, the 2019/2020 financial year was marked by 1) the strengthening of the balance sheet structure and the restructuring of bank debts with the support of a new financial partner, Cheyne Capital alongside the reference shareholder Montagne & Vallée, as well as 2) a vast industrial, legal and commercial reorganization of the group as part of the 2024 strategic plan.

This reorganization, which aims to improve the operational performance of the group in a sustainable manner, resulted in the rationalization of industrial sites (closure of two sites in Germany and Sweden) and commercial (closure of three foreign distribution subsidiaries ) and the repatriation of all productions in France within the Sainte-Hélène-du-Lac unit, in Savoie (France). The full integration of these operations is already operational, making it possible to industrialize the production of “Made in France” equipment exported throughout the world.

From a financial standpoint, this reorganization will make it possible to reduce the cost structure by around ME 6 over a full year, thereby lowering the operational break-even point and thus targeting EBITDA adjusted to break-even from the 2020-2021 fiscal year. Two thirds of these savings have already been effective since the start of the 2020-2021 financial year thanks to the rationalization of the number of industrial sites, the ongoing reduction in the number of distribution subsidiaries and the optimization of a certain number of costs. group fixed.

In addition to the impact of the net decline in activity over the entire financial year, which automatically weighs on the group’s operating profitability, the results for the 2019/2020 financial year are mainly impacted by non-recurring costs. , including 18 ME with no impact on cash flow, linked to the finalization of this industrial, legal and commercial reorganization of the group.

In view of these financial transactions and operational reorganization, the 2019-2020 accounts are therefore particularly atypical.

Financial situation

As of June 30, 2020, MND’s consolidated shareholders’ equity amounted to -52.4 ME (-29.5 ME at the end of June 2019). MND’s corporate equity amounted to 10.8 ME at June 30, 2020. Net financial debt (excluding IFRS 16 rental debt) was 74.9 ME at the end of June (65.9 ME at the end of June 2019). . This net financial debt included, at the end of June, 9.5 ME of bonds which are intended to be converted in the medium term and which will thus strengthen the group’s shareholders’ equity and reduce its debt (3.5 ME have already been converted to dated). In the end, the group generated a positive cash flow variation of 22.1 ME during the 2019-2020 financial year.

During the 2019/2020 financial year, the group worked to strengthen its balance sheet structure and reorganize its bank debts with the support of a new financial partner, Cheyne Capital, alongside Montagne & Vallée, the reference shareholder of MND. These transactions resulted in the completion, at the end of September 2019, of two capital increases for a total gross amount of 35 ME and the reorganization of 34.8 ME of short and medium-term bank debt into final debt by May 2024.

New funding

During the first half of the 2020/2021 financial year, MND continued to strengthen its financial capacities, to support the return to full capacity of its production sites and to adapt its organization to the new economic environment. The MND group now benefits from senior financing from Cheyne Capital for a total amount of 55 ME, maturing in late May 2024 and with 100% of capitalized interest. This senior financing is accompanied by customary covenants, relating in particular to quarterly compliance with financial ratios making it possible to assess the weight of the debt on the balance sheet and the income statement.

MND is also announcing the conversion of a simple bond loan with a nominal amount of 5.4 ME, held by European investors, into a convertible bond loan by offsetting the debt of simple bonds issued in 2019.MND also announces the completion of a reserved capital increase of 400 kE, in cash by offsetting of debt, with cancellation of shareholders’ preferential subscription rights, by issuing 4 million ordinary shares, at the price of issue of 0.10 euro, without issue premium.

Backlog

As of June 30, 2020, the group’s firm order book amounted to E197.1 million, including E28.1 million of orders to be invoiced during the 2020-2021 fiscal year (which will end on June 30, 2021).Since the start of the 2020-2021 fiscal year, the MND group has experienced sustained order intake, notably with the € 7 million in orders for snowmaking systems from renowned international ski areas in France and Italy. , Austria, Switzerland and Japan, most of which will be carried out over the 2020/2021 financial year, the gain in the construction of the new urban and tourist cable car in the city of Huy (Belgium) representing 5.3 ME for MND, or related projects to the safety of ski areas in Europe, Central Asia and North America. As of September 30, 2020, the group’s firm order book stood at 56.1 ME, up + 31% since the end of June, including 29 ME of orders still to be invoiced during the next three quarters of the new fiscal year 2020- 2021 (closed June 30, 2021).

Outlook

Based on good order dynamics, the group aims to return to normative operational balance (adjusted EBITDA) from the 2020-2021 financial year, which will end on June 30, 2021.At the end of the 1st quarter of the 2020/21 financial year, MND’s activity shows clear growth and is in line with the roadmap to achieve this objective of returning to operational balance.

News from the debt markets recently largely concerns LaSalle Investment Management’s first close for its latest debt fund, and the entry into the European debt investing market after taking over the real estate financing business of Swiss asset manager GAM.

LaSalle Investment Management announced the first close of its LaSalle Real Estate Debt Strategies IV (LREDS IV), the fourth fund in its debt strategies series, with €435m of aggregate commitments. This puts it on track to achieve a total capital raise of €1bn ($1.2bn), with commitments from both existing and new clients to the LREDS series, across a broad range of European and Asian pension funds and insurance companies.

LREDS IV’s investment strategy focuses on mezzanine debt investments secured on real estate across western Europe with a focus on Germany, the Netherlands, UK, France and Spain. The debt fund also offers whole loans, capex and development financing solutions.

LaSalle’s European Debt & Special Situations platform has been investing across both traditional asset classes such as office, logistics and residential, as well as alternative asset classes such as student housing and self-storage. Since 2010, the platform has invested €3.4bn in investments across 78 transactions.

Ali Imraan, managing director and fund manager for LREDS IV, said: “We continue to see strong demand for LREDS IV from investors who are attracted to the downside protection in light of the uncertainty due to the pandemic while still aiming to generate healthy current returns…We are already seeing some compelling opportunities given that the traditional banks remain relatively cautious while it also allows us to wait and take advantage of any dislocation opportunities that arise from the current uncertainty.”

Amy Klein Aznar, head of debt & special situations for LaSalle Investment Management, said: “The team has already completed several debt investments this year, working with strong sponsors and senior banking partners across Europe, which has reinforced our position as a leading debt provider in the market.”

LaSalle’s European Debt & Special Situations platform also includes the €900m LaSalle Whole Loan Strategies offering whole loans across Western Europe, the €1.5bn LaSalle Residential Finance series offering residential, student housing, hotel and healthcare development lending, and the GBP225m Special Situations Venture which invests alongside sponsors in, among others, preferred equity, joint-venture equity and higher-leverage mezzanine.

Meanwhile, US-owned giant Invesco Real Estate has gained a foothold in European debt investing after buying the real estate financing business of Swiss asset manager GAM. The move now gives the fund manager global lending capabilities, complementing its Asia-Pacific and US debt businesses.

GAM had been looking to reduce its staff and costs, and it was apparently opportune to offload the business with its seven-strong team led by Andrew Gordon over to Invesco, which had been looking for a European bolt-on acquisition for some time. GAM had bought the business in 2015 from Renshaw Bay.

Andy Rofe, Invesco’s managing director for Europe, said “What we wanted to do was have the capability of investing in the real estate debt universe in Europe, which we didn’t have previously… (GAM) is a natural adjunct to the business. We have that full capability of public, private, equity and debt in the US, and wanted to complete that offering to clients in Europe as well.”

All 22 of GAM’s real estate debt investor clients, representing a debt portfolio of about $300m will move over to Invesco, where many of them already have existing relationship with other Invesco businesses.

Rofe said that “dislocation in the market” caused by COVID-19 would lead to a further “pullback from traditional lenders”, accelerating the growth in non-bank debt in Europe since the global financial crisis. “That creates an opportunity for lenders who are best positioned to identify and exploit those funding gaps and be able to provide liquidity to the market.”

Invesco has a strong presence in the European real estate market, with US$ 14.6bn in European direct investments1. In June it held the third close of its European Value-Add Fund II, having raised €550m of its €750m target from 18 European, UK and US investors. Ninety per cent of the investors in Invesco’s first value-add fund have committed to EVAF II.

“The dynamics shaping the European debt market are very attractive, and we are keen to fast track our European offering with our new debt team. This gives us highly experienced professionals and asset class momentum from day one, with a view to developing the debt proposition further,” said Rofe.

Also eyeing the European market is London-based alternative asset manager Cheyne Capital, which is thought to be targeting up to €1.5bn for the latest in its series of real estate debt funds. Cheyne is thought to have already raised Stg500m in a first close for series VI and VII of its CRECH suite of funds (Cheyne Real Estate Credit Holdings).

Cheyne targets gaps in the market left by the withdrawal of traditional debt providers. It is currently focused on borrowers requiring finance for value-add, transitional or development projects, mainly in the UK, France and Germany. With debt for these assets currently in short supply, Cheyne believes it can get strong risk-returns from senior lending where it will have first charge over the property, although it is able to lend higher up the capital stack. It has already made loans on its new debt series – two in the UK and one each in France and Spain.