Europe faces a daunting number of regulatory reforms and measures over the next three years which could help stifle bank lending to property, Tim Bellman, global head of research at ING REIM, said in an interview with PropertyEU.
Europe faces a daunting number of regulatory reforms and measures over the next three years which could help stifle bank lending to property, Tim Bellman, global head of research at ING REIM, said in an interview with PropertyEU.
'It is very hard to judge what the ramifications are likely to be of the wave of regulations set to hit the market in Europe because the details of many of these regulatory measures have yet to be fleshed out,' Bellman said in a comment on the Gobal Vision 2011 report. 'But I think the direction we are headed is that there will be high levels of capital reservation by real estate lenders either if they go into CMBS structures or whole loan lending.'
'What worries me most is the number of regulatory reforms that are all coming at the same time: Basel III, Solvency II, the Alternative Investment Fund Management Directive, the Dodd-Frank legislation in the US, tighter restrictions under the International Accounting Standards. All of this is scheduled to hit the market in 2012 or 2013 and we need to start getting our heads around the detail in the year ahead.’
Bellman noted that the flipside of less bank lending is that ‘there is an awful lot of equity capital from investors out there that is looking at real estate’. He pointed to a recent survey by research firm Preqin which identified between $80-174 bn worth of equity that has been allocated by investors to real estate and has still to be invested.