A quarter of real estate financing will come from non-bank sources in five years’ time, AEW Europe predicts.
The investment manager, which has just launched its Senior European Loans Fund with €240m of initial equity, said new lenders such as insurers and debt funds will provide €33bn of senior debt out of an estimated €130bn in 2017.
AEW Europe chief executive Christian Delaire said: “In Europe, the proportion of senior debt lent by non-banks has been close to zero, while in the US it is 50%. We think it will be somewhere in the middle here.”
Delaire said the shift was structural – “not a short-term event; it is a long-lasting shift”. The senior loan fund’s three investors are French insurance fixed-income clients, jointly advised by the fixed-income arm of AEW’s parent, Natixis.
The fund managers are AEW’s Veronique Leblanc and Natixis’s structured credit head Stephane Caron. The fund’s first loan is a €20m participation in a five-year, €100m club loan with two banks, led by a French bank, secured on a French logistics portfolio.