The growing number of non-bank lenders providing higher loan-to-value offerings will create increased demand for credit underwriting and loan management services in Europe, according to loan servicing firm Trimont Real Estate Advisors.
In a bid to grow its presence in Europe, the US-headquartered real estate asset manager, loan servicer and advisor has hired Dean Harris and Paul Robinson to the newly created roles of head of asset management and head of underwriting and advisory services for Europe, respectively. Prior to Trimont, Harris spent six years with Situs in London, setting up and managing its loan asset management platform. Robinson spent seven years in a similar role with Hudson Advisors.
“We see our clients increasingly looking for more value-add support in both the underwriting and ongoing management of their credit investments in Europe,” Bill Sexton, Trimont’s senior managing director at EMEA, told Real Estate Capital. “These services are particularly important as the real estate market in Europe continues to mature; clients want to make sure that debt capital is deployed well and that their risk is managed carefully.”
Sexton, the former Mount Street managing partner who joined Trimont last September to boost the firm’s business in Europe, explained that an increasing number of non-bank lenders, in their search for enhanced returns, are open to increased leverage in their loan offerings.
“More non-bank lenders are looking at higher LTV offerings and, given the increased risk that this implies, these lenders are looking for a more specialised support in the underwriting and proactive loan asset management going forward,” Sexton noted.
Trimont is seeking to capitalise on opportunities arising from the proliferation of non-bank lending in Europe, such as debt funds’ increased interest in construction loans. The servicer, which oversees around $30 billion in construction deals, also wants to benefit from its expertise in repositioning and development loans.
“With higher competition in the investment financing markets, non-bank lenders are looking to other markets where the banks are less active,” Sexton said. “In particular, speculative construction is difficult for commercial banks to lend against, and as a result, non-bank lenders are gaining an increased exposure in this space, as they don’t have the same regulatory restrictions.”
Trimont is looking to “more than double” its European loan book – currently ranging between $8 billion and $10 billion – within the current cycle, Brian Ward, global chief executive officer, told Real Estate Capital in September last year.
The firm, which has offices in London and Amsterdam, is focusing on active performing real estate markets in Europe, particularly in the UK, Spain, Italy and the Netherlands. As part of its European push, Trimont has relocated the loan servicing and treasury units from Atlanta in the US to the Netherlands, with the aim to “scale the business” and provide “localised support” in Europe, Sexton said.
“We are also making other hirings to take the London team to up to 10 people by the end of May,” he added.