INTERVIEW: Pricoa to double new real estate loans in Europe this year

Pricoa Mortgage Capital, the commercial mortgage lending business of US-based Prudential Financial, is on a lending spree in Europe.

Fresh from underwriting more than €600 mln of loans in recent weeks, it is on track to double new business this year, according to Bryan McDonnell, head of European originations at Pricoa.

‘We have underwritten €1.2 bn ($1.3 bn) of loans in Europe so far this year – that’s a record for us,’ said McDonnell. ‘We did about half that last year. Next year, we have the capacity to underwrite up to €1.8 bn ($2 bn) if the deals are available and meet our investment criteria. If we manage that, it would be fabulous.’

Earlier this week, Pricoa provided a €68 mln loan to IDI Gazeley Brookfield Logistics Properties, the logistics real-estate arm of Brookfield Property Partners, to finance the acquisition of 13 multi-let logistics properties located across the Netherlands. It was a fixed-rate loan with a five-year term.

Expansion
Pricoa is considering expanding its footprint in Europe. ‘The UK is the largest lending market for us,’ said McDonnell. ‘We’re also asking ourselves if we can get into other geographies across Europe, such as Ireland, Spain and the Nordics. We want to be a local European lender and we will lend on anything that is income-producing.’

Today, Pricoa’s loan book in Europe totals €2.3 bn, which it has built up in the past four years. Of that, around 50% is lent against offices, 25% against logistics and the rest against alternative asset classes, such as student housing and hotels. Pricoa is mainly operating in the UK and the Netherlands, although it is looking at opportunities in other countries to support its pan-European expansion, according to McDonnell.

PropertyEU Magazine
The full interview with Bryan McDonnell of Pricoa appears in the November edition of PropertyEU Magazine.

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