In case you missed the big reveal, the winners of the Real Estate Capital Awards 2020 were announced on recapitalnews.com and in our spring print edition this week. Click here to see the results in full.
It is fair to say each of the organisations and deals that won an award did so despite the challenges placed in front of the property lending industry by the covid-19 pandemic.
From the information contained in the many awards pitches we gratefully received, to the way you, our readers, voted, our editorial team gained plenty of insight into the industry’s response to covid.
Here are some reflections on what we learned.
Banks were down but not out:
Sponsors continued to demand finance in 2020, for refinancing, acquisitions and even development. Banks, as many sources have told us, were often reticent to provide it. However, our awards process taught us that several remained significant providers of liquidity in property markets, albeit selectively.
US investment banks had fewer big-ticket opportunities and a slower syndication market to contend with. But deals such as the £2.6 billion (€3 billion) financing of Blackstone’s iQ Student Accommodation platform acquisition by banks including Bank Lender of the Year: Europe winner, Bank of America, showed they remained in the game. Commercial banks’ appetite for real estate was severely tested. But some remained significant debt providers, often in their domestic markets and to well-known customers.
Alternative lenders saw an opportunity:
The volume of awards submissions from investment managers, insurers and other alternative lenders showed that growing exposure to real estate credit was front of mind for many non-banks as market disruption generated greater access to lending opportunities.
Also notable was the range of transactions which non-bank lenders closed, ranging from large, prime portfolio refinancing deals to loans for opportunistic buyers of property. Our awards show alternative lenders are a diverse and growing component of the market, with a range of capital at their disposal.
Investors wanted in:
A new award – Fundraising of the Year: Europe – sparked significant interest. It was clear both seasoned capital raisers and new entrants to the market were able to capitalise on growing investor demand for credit strategies as the lending market disruption generated attractive risk-adjusted returns.
Among the shortlisted parties, US manager AllianceBernstein entered the European lending market with €1.2 billion at its disposal, Sweden’s Brunswick Real Estate raised €1.2 billion for its third Nordic credit vehicle, and M&G Investments closed three funds on a total £1.6 billion. The winner, US mega-manager Blackstone, gathered $8 billion for its fourth global debt fund – said to be the largest ever property credit fund.
Advisors were in demand:
The number of votes in our debt advisor categories highlighted that intermediaries were valued in a year in which sourcing debt became trickier. Our winners – Brookland, Brotherton Real Estate, CBRE and First Growth Real Estate – all demonstrated their deal-making abilities. The spotlight also fell on loan servicers, including category winner Trimont Real Estate Advisors, to help lender clients deal with issues across their loan portfolios.
Many were keen to flag sustainability:
Across the submissions, many highlighted green credentials in financing deals – and our editorial team took them into consideration when drawing up shortlists. For instance, Development Financing Deal of the Year: Europe went to the parties behind the €432 million financing of Arboretum in Paris – Europe’s largest wood-based office campus.
We also received a high volume of convincing submissions for Sustainable Finance Provider of the Year: Europe, which led to a close race between four parties, eventually won by three-time winner Lloyds Banking Group. Although the property debt industry still has a way to go on sustainability, the focus in awards submissions shows it is high on lenders’ agenda.