REC Awards 2017: Banks take the spoils

Commercial and investment banks dominated in several categories, demonstrating their continued reach across Europe’s markets.

It’s the time you’ve all been waiting for… the results of the Real Estate Capital Awards 2017 can finally be revealed and you can view the full winners’ list here.

Our awards – voted for by you, the readers – recognise the best in European real estate finance, including lenders, borrowers, advisors, loan sales market participants and the deals that stood out in 2017.

Without giving away too much before you delve in, here are a few observations on how our list of winners reflects current trends in the European property lending space.

1. Senior banks with large balance-sheet capability, which have steadily provided liquidity throughout the cycle, have done well. The Bank Lender of the Year category, as well as several of our country-specific lender awards, have gone to commercial banks which have strived to build their loan books and lending capabilities during this decade of recovery.

2. The activities of the investment banks, during a year in which private-equity sponsors required finance for complicated, time-pressured transactions, have also been recognised. It is an investment bank that has been voted the standout lender in the Southern European markets, while the investment financing deal of the year has been awarded to one of the sexier mega-deals, led by investment banks, that closed during the year (with a deal on a similar scale, involving several of the same players, coming a close second).

3. The contribution of alternative lenders has been rewarded, perhaps most notably in our Financing Deal of the Year – Development category. Here, a London construction financing, which in previously cycles would almost certainly have been taken on by a bank or a club of banks, has been scooped by an alternative capital source, which has proved its financing mettle across several recent deals. In addition, the battles for our senior and high-yield debt fund lender awards were keenly fought, as usual.

4. There are surprises in there, reflecting a market in which a wide array of organisations of varying scales are doing plenty of business. The debt advisor award, for example, has been won by one of the market’s busier boutique firms, perhaps demonstrating the increased emphasis sponsors are placing on intermediaries in deals across the spectrum.

One clear message to take from 2017, was that debt played an important role in the European real estate markets. During the year, private real estate debt vehicles with a focus on Europe attracted in the region of $10 billion of capital, more than double the amount corralled in the previous year, our data show.

Despite concerns about low yields and the prospect of rising interest rates, the appetite for real estate investment displayed in 2017 is likely to continue throughout 2018. Debt to support investment will be plentiful and will come from an increasing array of sources. With more debt capital to deploy, it is essential that conservative lenders remember their risk parameters and those seeking higher returns in less liquid parts of the market back only those sponsors most likely to add value to their investments.

The European real estate lending markets were not without their challenges during 2017, but our awards demonstrate that there are plenty of organisations out there keeping debt capital flowing.

Email the author: daniel.c@peimedia.com