Debt vehicles deliver robust performance. Investors and managers target multi-country and senior debt strategies
17 November 2020, Amsterdam – Non-listed real estate debt products continue to attract attention from institutional investors and investment managers, with a record high of €32 billion raised globally in 2019, according to the INREV Debt Vehicles Universe 2020 study*.
Invesco Real Estate has taken over the European real estate debt business of GAM Investments, giving the fund manager global lending capabilities.
A seven-strong team, led by Andrew Gordon, have been transferred from GAM to Invesco, along with a US$300m (€250m) of assets held in two funds and a separate account.
The acquisition adds to Invesco real estate debt businesses in the US and Asia-Pacific, and comes amid efforts at GAM to reduce staff and costs.
LaSalle Investment Management’s fourth European real estate debt fund has so far raised €435m and is on track to reach its €1bn fundraising target, the manager said.
LaSalle said the capital raised by the LaSalle Real Estate Debt Strategies IV (LREDS IV) fund at the first close was received from both existing and new clients, made up of pension funds and insurance companies across Europe and Asia.
The previous fund, LREDS III, exceeded its initial £750m target to raise over £800m of commitments in 2017.
PGIM Real Estate has expanded its European senior loan portfolio with the provision of €161m to finance two portfolios in the Netherlands.
The real estate manager has provided a €56m for the acquisition and refinance of seven logistics assets and €105m to refinance the development of a private rented sector (PRS) portfolio owned by Foolen & Reijs Vastgoedgroep.
The PRS development loan is a co-investment between PGIM Real Estate and ABN Amro, who also arranged the loan.
Allianz Real Estate has expanded its European debt portfolio with the provision of a £400m (€440m) loan in London, in a deal which represents the manager’s largest single-loan debt transaction in Europe.
The manager, through its Luxembourg-based debt fund PAREC, has financed a 630,000sqft portfolio of five central London offices owned by Lazari Investments.
The deal is the first transaction between Allianz and the Lazari and Allianz’s seventh debt transaction in London and it is the third since it opened its London office in June last year.
PGIM Real Estate has so far raised 35% of a £1bn (€1.1m) fundraising target set for its latest European debt vehicle, according to one investor.
Pennsylvania Public School Employees’ Retirement System (PSERS) said in a meeting document that it has approved a $125m commitment to the PGIM Real Estate Capital (PRECap) VII, a fund which has so far raised £350m.
PGIM raised more than £1bn for the predecessor fund in April 2017.
The fund manager is expected to make a co-investment into the fund of up to £75m.
Allianz Real Estate has provided £120 mln (€141 mln) in debt financing to The Office Group (TOG), majority owned by real estate funds managed by the Blackstone Group, for the acquisition and refurbishment of Chancery House in London.
The deal, completed on behalf of several Allianz group insurers, is the fifth debt transaction in London for Allianz Real Estate and the first since it opened its London office in mid-2019. Chancery House is a 150,000 sq ft (13,940 m2) prime asset in Midtown on an island site minutes from Chancery Lane underground tube station.
Real estate investor and manager Cromwell Property Group (Cromwell) has confirmed that it assisted Cromwell EREIT Management Pte Ltd, the Manager of Cromwell European REIT (CEREIT) to raise and conduct a EUR625 million unsecured debt refinance, on behalf of Cromwell European REIT.
This sees CEREIT’s weighted average term of debt extended to 3.6 years while maintaining its attractive cost of funding at approximately 1.50 per cent.