EUROPE – Longbow Real Estate Capital is targeting a first-half listing for a £100m (€118.8m) UK senior debt fund targeting a 6% return.
ICG-Longbow managing partner Martin Wheeler this week declined to comment on where appetite for the fund would come from, citing US and US regulatory restrictions.
But he said: "The main trend we are seeing is that investors have become comfortable with the strategy over the past year and are now ready to invest or select a manager."
Wheeler's comments came just weeks after ICG announced that it had raised more than £212.5m in the first close of a Luxembourg-based mezzanine and whole-loan fund it launched with Longbow.
The fund is targeting capital of £500m and a return of 11%.
ICG-Longbow has pursued a whole-loan strategy since the fund's predecessor had its first close in 2010.
Wheeler said the strategy offered investors a defensive risk position with attractive returns.
The firm has identified an increase since the end of last year in opportunities linked to banks reducing their property exposure.
Although to date the offloading has been selective – largely carried out on a loan-by-loan basis – Wheeler said investors were aware this type of transaction was uncommon outside the UK.
ICG, a mid-market specialist, will also capitalise on "a wall of refinancing" coming up over the next few years as banks pull out of lending to European mid-market companies.
"In the past, banks would have fulfilled the supply of credit need," Wheeler said. "But now the role of non-bank lenders has grown, although Europe has a long way to go before it reaches the US levels of institutional lending."
