AXA Real Estate has attracted a first US investor to its expanding European real estate debt investing business. Charles Daulon du Laurens, head of investor relations for the business, said: “North American investors, from the US and Canada, are looking at Europe because of the spreads.
“Senior commercial real estate loans in the US are probably yielding the equivalent of Libor plus 120-160bps, whereas in Europe, for a similar type of leverage, it is 200-400bps.” He added: “The relative difference between spreads in Europe and in Asia is even wider, especially in Japan.”
Daulon du Laurens said there was interest in AXA’s business from Hong Kong, Taiwan and Singapore, as well as Japan. AXA had raised €7bn by the end of 2012 for its commercial real estate debt programme, with new investors coming from the Nordics, the UK, Ireland and Switzerland. It aims to secure another €2bn this year.
Daulon du Laurens said: “Our focus remains on investing in the UK, France and Germany, in that order.” He said there was evidence that spreads were starting to tighten AXA’s deals last year included the acquisition of an €800m portfolio from Société Générale. More recently, AXA took a participation alongside BAWAG in a €115m loan arranged by Credit Agricole for Blackstone’s acquisition of French logistics assets from Gecina.