Listed property companies double issuance of convertible bonds in H1

Listed real estate companies across Europe have issued convertible bonds with a total volume of €1.5 bn in the first half of this year, according to a study by Société Générale.

'The volume has doubled compared to the same period last year,' Ralf Darpe, head of equity capital markets at the French bank, told PropertyEU. Société Générale is Europe's leading player in the placement of convertible bonds with a market share of 11.3%.

Indeed, Europe's listed real estate sector has taken a lead position in the convertible bond market. According to Société Générale, property companies accounted for 16% of all convertible bonds issued in Europe since 2011 with a total volume of €71.7 bn. Oil companies came second with a market share of 11%, followed by technology companies with a market share of 8%.

Some of the most active players so far this year include listed German residential companies. In May, residential giant Gagfah successfully issued a €375 mln convertible bond with a coupon of only 1.5%. In April, LEG Immobilien generated €300 mln with a bond carrying a coupon of between 0.125% and 0.875% in a move aimed at diversifying the company’s financial base. And in November last year, Deutsche Wohnen placed a €250 mln convertible bond to finance the takeover of its Berlin-based competitor GSW.

But the largest convertible bond to be placed by a property company so far this year in Europe was a €500 mln paper due to mature in 2021 and issued by Franco-Dutch retail specialist Unibail-Rodamco.

The full analysis is available to premium subscribers in the link to the related article below.