A new Capital Bay managed open-ended European real estate loan fund has been seeded with an initial portfolio of loans worth almost €400m.

The manager said the Capital Bay Europe Secured (CBES) Whole Loan Fund, which has an initial portfolio of loans in London and major UK cities, has a target volume of €1.5bn.

CBES Whole Loan Fund expects to expand its portfolio and fund projects in France, Germany, and Italy.

Rolf Engel, CFO of Capital Bay Group and CEO of Capital Bay Fund Management, said: “We have seen during the Corona pandemic that traditional bank financing has declined, especially for project developments, due to the uncertainties in the market and regulations such as Basel III.

“Project developers are increasingly turning to whole loan from alternative lenders to finance their projects. The CBES Whole Loan Fund picks up on this demand and provides the necessary capital. We already have very high demand for this investment opportunity.”

The fund’s initial portfolio was originated by London-based specialist lender EVH Finance. EVH Finance will act as the fund’s nominated advisor.

Victor Librae, CEO of EVH Finance, said: “We are seeing significant financing opportunities across the UK and Europe and look forward to executing on these through this vehicle whilst providing investors with attractive risk-adjusted returns.

“This is a significant milestone for our business which was launched in July 2020 and has already committed over €700m.”

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