2012 sees record volume of bond issuance: DTZ

A growing number of property companies are raising public debt through corporate bonds, offsetting maturing CMBS structures, according to DTZ Money into Property 2013 Europe report.

According to DTZ's research, more than €15 bn was raised in 2012 through corporate bonds.

'This represents a 70% increase over the year and is a record high since 2006,' said Nigel Almond, head of Strategy Research at DTZ.

Invested stock grew by a marginal 3% in 2012 driven by an increase in equity in core markets. The increase came from the three major markets in Europe while the rest of the region posted a 1% decline. Growth was predominantly driven by increases in equity but public debt reversed its declining trend with a modest 1% growth over the year.

'Overall the value of debt outstanding in 2012 fell marginally and despite deleveraging, overall bank debt held stable,' commented Almond. 'In contrast, non-bank lenders realised growth as they picked up some of the slack from traditional banks.'

Non-bank lending provided by institutions or debt funds increased 80% to €34 bn in 2012 from €19 bn in 2011.

Despite the continued uncertainty in the Eurozone, total real estate investment volumes grew by 6% in 2012 with €118bn invested, up from €112 bn recorded in 2011. Investors remained focused on core markets particularly, the UK, Germany and to some extent, France.