Liquidity remains a major potential problem for European REITs, with more loan-to-value breaches looming in the months ahead, according to Lynn Valkenaar, vice president and senior analyst at ratings agency Moody's.
Liquidity remains a major potential problem for European REITs, with more loan-to-value breaches looming in the months ahead, according to Lynn Valkenaar, vice president and senior analyst at ratings agency Moody's.
'Many REITs have big bank loans and CMBS debt which are coming up for maturity. In some cases, it's not obvious how these loans will be refinanced. Refinancing via the bond market is too expensive at the current prices and with respect to secured bank lending, the adage in the UK is that a 50% LTV is the new 75%. This could mean that we are likely to see companies exploring the potential to find equity or hold a rights issue.'
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