Alternative lenders with an integrated platform will emerge as the winners in a highly competitive European financing market, Cushman & Wakefield’s partner and head of the EMEA Corporate Finance team Michael Lindsay said at Expo Real.

Alternative lenders with an integrated platform will emerge as the winners in a highly competitive European financing market, Cushman & Wakefield’s partner and head of the EMEA Corporate Finance team Michael Lindsay said at Expo Real.

‘There is almost more capital available than product at the moment and those people who can provide both senior debt and mezzanine financing will be the winners, because this structure limits execution risks for clients, as they have to deal with only one party,’ Lindsay said.

He pointed to Barclays’ large financing to Oaktree and Patrizia for a business park in Reading as a recent example of this structure. ‘In this case, Barclays provided a loan with a loan-to-value of 72% including both senior and mezz debt,’ he noted.

Commenting on the financing market in Europe, Lindsay said that banks are relaxing their grip somewhat on loan-to-value requirements.

‘Risk is being repriced in a way. We see loans at 160 basis points from 200 bps previously and we see that lenders are feeling more comfortable with higher loan-to-value ratios of up to 60-65%, from 55% previously.’ Similarly, the cost of mezz debt has decreased from the low teens to 8% in some cases today.