Investec, a leading provider of development and investment finance, announces that it has committed to provide over €443.35m (£400m) in senior loan facilities in the first half of 2017, a strong period in the current economic environment.
Investec has lent against numerous high-quality real estate schemes, across the UK, in an increasingly diverse mix of use classes including residential, purpose built student accommodation (PBSA), commercial, build to rent and retirement living.
Highlights include:
- Return to investment financing as demand grows: Investec’s most recent significant investment finance facility is an £18m loan to Ballymore Group, representing Ballymore’s first debt financing since exiting NAMA
- Strong appetite from major global private equity firms: Three recent loans, totalling c. £100m, to Real Estate Funds backed by major global private equity and asset managers, taking the total lending in the Real Estate Fund sector to £400m in the last three years:
- £70m across two facilities with Curlew Student Trust, backed by clients of CBRE Global Investors;
- 50% of an £85m development loan to Anthology, established by Oaktree Capital Management - Student Accommodation fundamentals remain in place: C. £100m lent to leading developers of PBSA totalling 5 schemes and 2,200 beds, in prime locations that benefit from an attractive supply demand tension, including London, Southampton, Bournemouth and Newcastle. Investec has now financed more than 9,000 beds across 17 university cities since the start of 2015
- Demand continues for well located, good quality residential schemes: Strong demand remains for prime residential in zone 2-6 London locations. The team’s extensive experience as well as strong relationships with leading housebuilders including Meyer Homes and Anthology have enabled Investec to be very active in this space
- Retirement living interest building: A first retirement living scheme, via a £55m loan facility to Auriens for 55 super-luxe residential apartments in Chelsea, South West London
Gary Dobson, Head of Investec Structured Property Finance, said: “Favourable fiscal policy continues to support both new and established borrowers of commercial real estate development and investment financing and Investec is ideally placed to provide this, having delivered time and time again on successful schemes. We are confident in the prospects for the second half of the year, leveraging both our existing relationships and the strength of the team.”
Mark Bladon, co-head of origination at Investec Structured Property Finance, added: “The breadth and depth of our lending during the first half of 2017 demonstrates our market-leading ability to provide innovative and efficient loans to both new and existing clients. Our recent investment deal with Ballymore demonstrates Investec’s ability to provide financing across the project lifecycle, offering clients a consistent lender from acquisition, through development and into the investment phase.
The continued retrenchment of the high street banks from the development financing sector and prohibitive costs of the debt funds has allowed us to continue as the first-choice provider of financing for many borrowers, from established housebuilders through to fast-growing developers and private-equity backed funds.
“Whilst the London residential market remains buoyant and our core area of focus, supported by favourable drivers, we have seen a number of new trends emerging during the period as our client base continues to diversify. In particular, our ability and expertise in dealing with Real Estate private equity funds across the Bank enables us to offer innovative and flexible finance solutions including asset level debt, fund level facilities and strategic hedging, providing a full client offering.”
