Germany’s biggest real estate bank, Eurohypo, has said it is actively seeking to undertake new business in the UK after a four month break from the market.
The Frankfurt based lender told Property Week Global that it was looking nationwide for good opportunities and would undertake deals at loan to value ratios of around 65%.
Eurohypo, which lent E2bn in the UK in 2008, stopped undertaking new loans to the market last October following a turbulent spell for European banks, which saw fellow German property financier Hypo Real Estate rescued from bankruptcy with a E50bn lifeline.
But Max Sinclair, co-head of Eurohypo’s UK division, said it was time for the bank to return to the market: ‘The UK is key for us. All banks have been looking at what type of business they want to be doing and we are no exception. We believe that the UK is one of our core markets outside of Germany.'
German banks featured heavily on Savills' top 12 list of property lenders looking at the UK, released yesterday (10 March). Deka Bank Munich Hyp, Deutsche Postbank and West Immo were among those seeking to do deals above £25m.
Sinclair said it was 'no surprise' that German banks were among the first to return to the UK market.
He said: ‘It makes sense that they are back. German banks can borrow money in the covered bond market, something that UK lenders cannot do.’ Germany’s covered bond market reopened last month when Deutsche Postbank sold a €1bn pfandbrief.'
In recent weeks Eurohypo has been linked to several UK-based deals, including a club lending deal for St David’s retail scheme in Cardiff, Wales with Deutsche Postbank, Immo Bank and Deka Bank. The bank is also rumored to be involved in financing William Pears Group’s £750m purchase of Trillium from Land Securities. Sinclair declined to comment on both deals.
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