Empira Research: The debt financing market for real estate

We are pleased to present the key findings of our latest exclusive research study, conducted by our Head of Research, Prof. Dr. habil. Steffen Metzner MRICS.

Based on a thorough analysis of the debt financing market for real estate, his findings clearly show a strong catch-up potential for alternative sources of debt financing in the commercial real estate financing market, especially in Europe. While the market share of private debt is likely to increase, banks will become less important due to regulation in this area, says Metzner. "For regulatory reasons, this growth will almost exclusively take place in the B2B segment, while consumer lending in the area of housing finance will remain a stronghold of banks."

A scenario of 10.0 percent market share of non-bank real estate financing in Europe "would correspond to 190 billion euros." Metzner puts this figure into perspective: increases to the level of the UK, where 28 percent is privately financed, or the US, would still lead to significantly larger submarkets for private financing."

To meet this demand, professionally managed private debt funds will significantly support the anticipated market growth in Germany and beyond.