LMA: Debt fund financing set for strongest growth

Debt fund financing will show the most growth in real estate lending and the residential sector will offer the best opportunities in the UK, according to the Loan Market Association’s real estate finance survey for 2015. The survey of 210 LMA members aimed to find where they believed the key investment opportunities and challenges lay in Europe and which sectors were most likely to drive future growth.

Debt fund financing will show the most growth in real estate lending and the residential sector will offer the best opportunities in the UK, according to the Loan Market Association’s real estate finance survey for 2015.

The survey of 210 LMA members aimed to find where they believed the key investment opportunities and challenges lay in Europe and which sectors were most likely to drive future growth.

More than 38% believed debt funds would demonstrate the greatest growth in real estate lending with banks second at 22% and insurers at 12%.

LMA REF-Survey-2015-4a

Almost half, 48%, believed access to funding from the debt and equity markets would be the biggest driver of growth for Europe’s property markets, with 36% believing economic fundamentals like market stability were most important.

Although half, 49%, believed the market was still in expansion mode, 40% believed too much competition overheating the market was its greatest challenge.

LMA REF-Survey-2015 Q1

In the UK, the residential sector was the clear pick of the best investment opportunities with 30% backing it compared to 19% for office space, 17% for student accommodation and 16% for industrial.

LMA REF-Survey-2015-9a
A third of respondents believed the Far East/South East Asia would be the greatest source of direct investment into European real estate with a quarter believing it would be the Middle East.

In the developing EMEA markets, more than 57% said the CEE and CIS had the greatest real estate finance opportunities, with 55% believing Poland was the best bet for investment opportunities.

 

 

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