German deal drives 29% rise in syndicated loans to €27bn

Syndicated real estate loan volumes jumped by almost a third to €27.6bn for the first half of 2015 compared to the same period last year, according to Dealogic.

In its second survey of the EMEA real estate loan syndication market since the global financial crisis, Dealogic reported that the number of deals was also up – to 75 for 1H 2015 compared to 71 for 1H 2014. The survey canvassed 26 lenders.

However, a single transaction, a €6.25bn facility to Deutsche Annington Immobilien in January, helped push up the volume figure from the €21.4bn recorded in 1H 2014. That deal also put JP Morgan at the top of both the bookrunner and mandated lead arranger tables, reporting totals of €6.33bn and €6.38bn respectively.

When lending to REITs (mainly unsecured corporate facilities) is excluded, there were 54 deals with a total value of €13.4bn in 1H 2015, up 21% from €11.1bn in 1H 2014. BNP Paribas led the bookrunner table with €1.29bn in five deals and HSBC is the top mandated lead arranger with €1bn in 10 deals.

The UK led the EMEA nationality ranking with a 31% market share. “Overall, the impression is of a healthy market with good levels of activity”, Dealogic said.

BNP Paribas’ €739.5m refinancing facility in January to Powerhouse France, which is managed by TwentyTwo Real Estate, made up more
than half of its bookrunning total.

Stuart Perry, head of leveraged and asset finance syndicate at BNP Paribas loan syndications, said: “Every month we seem to find a new potential lender to the market and that covers all aspects of real estate from the plain vanilla core-plus propositions to slightly juicier transactions – there’s a yield for everyone.”

“The arranging market hasn’t really changed but what we see changing is the potential participants in the market. Whether that is insurance companies or funds coming in on one side, or whether it is banks from as far as Asia, the list seems to be extending all the time.”

The latest Dealogic report comes as the European CRE syndication market gains further momentum, leading lenders to underwrite larger deals on competitive terms, knowing they can distribute.

The survey, which last reported in March, is supported by the Commercial Real Estate Finance Council (CREFC) Europe.

Peter Cosmetatos, chief executive of CREFC Europe, said: “As reporting continues to improve and the time series builds up, the league tables should become ever more interesting and valuable for market participants and observers alike.”