Europe’s Top 50 Lenders 2021: The Alternative Lenders, Part 2

In the final part of our annual list of Europe's leading property lenders, we continue to look at the alternative debt providers that made their mark in 2021.

Cain International

  • Deanston Wharf: Cain financed the scheme

    Development lender

  • Active in UK in 2020-21 due to travel restrictions

  • Lending in 2020: €170m

  • Lending in 2021 to end Q3: €435m

  • Loan book at end Q3 2021: €1.2bn

During the pandemic, Cain has focused its lending on its home country, and in 2021 it has provided several significant development loans. In January, it provided £74 million to Canary Wharf Group and hospitality group edyn for a 279-key aparthotel in Canary Wharf, London. In June, it provided £170 million to Ballymore and Oxley for the 768-unit Deanston Wharf residential scheme in east London, and £53 million to student accommodation provider Vita Group for a 496-bed scheme in Coventry. In September, it provided £109 million to Barings and LBS Properties for a green office scheme at 135 Park Street, London.

Cheyne Capital

  • Senior, mezzanine, whole loan, development lender

  • Active in UK, Ireland, France, Germany, Spain, Portugal, Nordics

  • Lending in 2020: €663m

  • Lending in 2021 to end Q3: €993m

  • Loan book at end Q3 2021: €3.6bn

Cheyne has been busy providing new loans during the pandemic. It reported closing 18 deals since 1 December 2020, across the residential, elderly care, hotel, student accommodation, and offices sectors in the UK, France, Germany, Spain, Portugal and Finland. Deal examples included a £99 million development loan in February to Goldman Sachs-backed Riverstone Living for a 160-unit assisted living scheme – a sector growing in popularity – in Fulham, west London. In May, it provided €63 million for the land acquisition and development of an office building in Bagneux near Paris. In June, it provided the same amount for the acquisition and refurbishment of a four-star hotel in Marbella, Spain, that is being repositioned with a new operator and franchise.

DRC Savills Investment Management

Senior, mezzanine, whole loan lender

Active in UK, Ireland, France, Germany, Netherlands, Spain, Nordics, Belgium, Italy

Lending in 2020: €828m

Lending in 2021 to end Q3: €651m

Loan book at end Q3 2021: €3.1bn

In May, Savills Investment Management bought the 75 percent of debt fund manager DRC Capital that it did not already own, prompting a rebrand. In 2021, it has completed several significant lending deals. In June, it provided €141.5 million at 47 percent loan-to-value to refinance Milan’s Four Seasons Hotel and fund its refurbishment. In April, it provided €20 million of mezzanine, at up to 65 percent, for office and logistics across the Netherlands. In August, it wrote €50 million of mezzanine for the redevelopment of a Brussels office, in which the sponsor is reusing the concrete frame to reduce carbon emissions.

DWS

  • Senior, mezzanine, development lender

  • Active across Europe

  • Lending in 2020: €298m

  • Lending in 2021 to end Q3: €230m

  • Loan book at end Q3 2021: €1.4bn

In March, Frankfurt-based manager DWS provided a junior loan to support one of Germany’s major development projects. The €65 million loan part-financed four mixed-use buildings at the Quartier Heidestrasse scheme, which is being developed by Aggregate Deutschland and Taurecon close to Berlin’s main railway station. In Q1, it provided a £21.5 million senior loan for a newly developed student housing scheme in Nottingham, UK, leased to student housing organisation Unipol. Elsewhere, DWS provided a €46 million junior loan against a German office development, a €45 million Italian logistics loan, a €25 million German office loan and a €25 million hotel loan, including collateral in Germany and the Netherlands.

Generali Real Estate

  • Senior lender

  • Active in Italy, France, Germany, UK, Spain, Central Eastern Europe

  • Lending in 2020: €500m

  • Lending in 2021 to end Q3: €460m

  • Loan book at end Q3 2021: €960m

In 2019, the Italian insurer launched its first commercial real estate debt vehicle. It has since become a frequent lender, both directly and through the syndication market. In June, through its Debt Investment Fund, it provided €95 million of a €540 million, five-year loan to a US private equity firm to refinance an office development in Berlin’s Mediaspree area. In September, it provided €80 million of a €160 million loan to a UK sponsor for the acquisition of an Italian logistics portfolio. Other deals this year have included a €50 million participation in a €126 million acquisition financing of an Italian residential portfolio by a Swiss sponsor in February. In the same month, it contributed €25 million to a Paris office development loan.

ICG Real Estate

  • Senior, mezzanine, whole loan, development, preferred equity lender

  • Active in UK, northern and western Europe

  • Lending in 2020: €622m

  • Lending in 2021 to end Q3: €669m

  • Loan book at end Q3 2021: €4bn

ICG’s £565 million of 2021 real estate lending, to the end of Q3, included £284 million of what it terms ‘partnership capital’, including whole loans, mezzanine and preferred equity. In September, it agreed a £100 million whole loan aggregation facility for MCR Property Group to support its strategy to acquire assets with development or repositioning potential. In May, it provided £86.8 million to Tristan Capital Partners for its acquisition of Reading International Business Park in the UK; the green loan – ICG’s first – supports Tristan’s repositioning plans. It is also growing its continental European lending. In December 2020, it provided an €85.8 million mezzanine loan to Asia Pacific Land for the acquisition and refurbishment of the Teleport II office campus in Berlin.

LaSalle Investment Management

  • Mezzanine, whole loan, development, preferred equity lender

  • Active in UK, Western Europe, Nordics, Iberia

  • Lending in 2020: €388m

  • Lending in 2021 to end Q3: €588m

  • Loan book at end Q3 2021: €4bn

In last-mile logistics, LaSalle originated €197.6 million and retained €100.8 million across two H1 loans for a pan-European portfolio. It entered Sweden as a lender, with a SKr182.6 million (€18 million) logistics loan. Residential deals included €175 million to support a developer and owner of 11,000 beds across Europe in August, and an €80 million whole loan in January to support a sponsor’s acquisition of Dutch for-rent assets. In May, it loaned €75 million to support a experienced manager with its Dutch and Belgian budget hotel portfolio. Its whole loan programme expanded into the UK, with a £57.5 million financing of Manchester’s Landmark Building in September.

M&G Investments

  • Senior, mezzanine, whole loan, development, preferred equity lender

  • Active in UK, Ireland, plus other European countries

  • Lending in 2020: €1.9bn

  • Lending in 2021 to end Q3: €755m

  • Loan book at June 2021: €5.6bn

In December 2020, M&G provided a £303.6 million loan to Sun Venture, a Singapore-based multi-asset investment firm, for the acquisition of the 1 and 2 New Ludgate office buildings in London. The entire loan amount was funded, and will be held to maturity, by clients of M&G. In May, it entered the Swedish real estate financing market with Project Birch, a SKr700 million (€70.5 million) senior loan for a portfolio of 16 industrial and logistics assets owned by Logistri Fastighets. In July, it provided a £362.5 million, five-year loan to refinance one of London’s largest private rented sector schemes. Other 2021 deals included a senior loan top-up secured against an Irish residential PRS asset in Dublin, and a senior loan top-up secured against a portfolio of Dutch PRS assets.

Morgan Stanley Investment Management

  • Senior, whole loan, loan-on-loan lender

  • Active across Europe

  • Lending in 2020: €437m

  • Lending in 2021 to end Q3: €732m

  • Total lending since inception: €2.6bn

North Haven Secured Private Credit Fund, managed by Morgan Stanley Investment Management, has become a significant source of institutional investor capital since its 2018 launch. It sits within MSIM’s $52 billion private real assets platform, separate from Morgan Stanley’s banking business, and the fund is capitalised by third-party commitments. In February, it financed a pan-European logistics portfolio for Exeter, with a €75 million participation in a €125 million deal. In July, it provided €50 million of a €165 million financing to Stoneshield Capital of a Spanish student housing portfolio. In September, it provided €20 million to Arrow Global for an Irish PRS portfolio, including new acquisitions.

NN Investment Partners

  • Going Dutch: NN operates a mid-sized loans strategy in the Netherlands

    Senior, whole loan lender

  • Active in Netherlands, Belgium, Germany, France, UK, Ireland, Spain, Italy, Portugal, Poland, Hungary, Slovakia, Czech Republic

  • Lending in 2020: €1.1bn

  • Lending in 2021 to end Q3: €815m

  • Loan book at end Q3 2021: €3.5bn-€4bn

The Dutch manager works with banks to write European real estate club loans and participate in syndications from the outset. It also partners with specialist lenders for a mid-sized Dutch lending strategy. We understand that NNIP provided €75 million of the €580 million refinancing, led by ING, of AEW’s pan-European Logistis fund in May. In March, it is understood to have provided €100 million of a €150 million, 10-year financing of a Dutch residential portfolio for a specialist residential sponsor.

Nuveen Real Estate

  • Senior, mezzanine, whole loan, development, loan-on-loan lender

  • Active in UK, Germany, Ireland, Spain, Netherlands

  • Lending in 2020: €874m

  • Lending in 2021 to end Q3: €835m

  • Loan book at end Q3 2021: €5.1bn

Nuveen’s 2021 loans have included an £81.3 million mezzanine facility, with an LTV of up to 70 percent, to finance Brookfield’s acquisition of a portfolio of nine UK retail warehouse assets; this forms part of an overall £292.8 million financing, including senior debt which was securitised by Morgan Stanley and Bank of America, and the mezzanine loan was retained by Nuveen’s client. In another deal, Nuveen provided a £339.6 million, 10-year fixed-rate senior term loan secured by a 40-asset last-mile logistics portfolio in the London area. Other deals included a £183 million and €110 million two-tranche financing, including fixed- and floating-rate elements, to fund the development and term financing of a logistics portfolio across Spain, the UK and Ireland. The facility was structured as a green loan.

PGIM Real Estate

  • Cold storage: PGIM provided mezzanine against a UK portfolio

    Senior, whole loan, mezzanine, bridge, preferred equity lender

  • Active across Europe

  • Lending in 2020: €898m

  • Lending in 2021 to end Q3: €866m

  • Loan book at end Q3 2021: €5.8bn

The investment manager’s deals in 2021 have included a £132 million, five-year senior bridge and mezzanine loan secured against a UK portfolio of cold storage facilities in January, in an example of a niche sub-sector financing. In November, the investment manager provided a £44.5 million mezzanine loan to fund the development of two build-to-rent towers in Manchester in the northwest of England. In July, PGIM provided a €77 million senior loan, with a seven-year term, against a 118,000-square-foot office building in Munich.

PIMCO

Newport Beach: PIMCO’s headquarters city

Senior, mezzanine, whole loan, development, preferred equity, loan-on-loan lender

Active across Europe

Lending in 2020: €700m

Lending in 2021 to end Q3: €1bn

Loan book: Undisclosed

The Newport Beach, California-headquartered manager has deployed more than €3 billion in European real estate debt in the past five years, with most of that closed during the pandemic. This year, it provided £100 million-plus of debt against a portfolio of new UK student housing, plus a similar sized acquisition loan for a full-service hotels portfolio in the country. In Ireland, PIMCO is understood to have provided €108 million of mezzanine, alongside senior debt from Apollo to developer Marlet for the construction financing of a prime office scheme within Dublin’s College Square development.

Starwood Capital

  • Senior, mezzanine, whole loan, development, preferred equity lender

  • Active across Europe

  • Lending in 2020: €570m

  • Lending in 2021 to end Q3: €1.7bn

  • Loan book at end Q3 2021: €3.7bn

With covid suppressing foreign travel, Starwood got behind the largest investment deal in the UK’s domestic holiday market. In February, it underwrote the £1.8 billion financing of Blackstone’s acquisition of Bourne Leisure Group, which comprises hospitality brands Haven, Butlin’s and Warner Leisure Hotels. Apollo and Blackstone’s lending business participated in the financing, of which Starwood retained £720 million. Other 2021 deals have included the £228 million refinancing of 14 premium UK senior care homes, a £122 million City of London office refurbishment facility and a €75 million loan to finance the refurbishment of two office buildings in Madrid, targeting an LEED ‘platinum’ rating.

Tristan Capital Partners

  • Whole loan lender

  • Active across Europe

  • Lending in 2020: N/A

  • Lending in 2021 to end Q3: €232m

  • Loan book at end Q3 2021: €230m

The private equity real estate firm is a newcomer to the lending market but, from a standing start, it has closed significant loan deals. In September, it made its first loan in the London market with a £22.5 million senior facility to Shorea Capital and Highbridge Estates to finance the purchase of a 39,000 square feet office building on City Road, which the sponsors plan to refurbish as sustainable, modern office space. In the same month, it financed Invesco and George Capital’s purchase of the Fort retail park in Birmingham with a £44 million senior loan; and provided a €53 million loan to Maya Capital to fund the acquisition and refurbishment of prime residential buildings in Lisbon.