AXA Real Estate has joined a rarefied group of lenders with the ability to offer loans of up to €600m (£500m) through its tie-up with Norges Bank Investment Management.
The partners will emulate AXA’s existing criteria, offering loans of between €50m and €600m, at margins of between 200 and 500 basis points.
Existing AXA clients will co-invest alongside NBIM, manager of the Norwegian Government Pension Fund Global, the world’s largest sovereign wealth fund.
AXA Real Estate global head of real estate finance, Isabelle Scemama, will run the platform from Paris, with support from local transactional teams, including in London, global head of asset management and transactions Anne Kavanagh.
Scemama said the focus would initially be on the UK, France and Germany owing to their dominance in terms of European market volumes, but did not rule out investing in opportunities elsewhere.
The venture will build on AXA’s existing real estate debt platform of €7.5bn, which has deployed €1.8bn in the year to date out of the €2.5bn target, 45% of which relates to the UK.
Hermes Real Estate Investment Management has also just confirmed it is in talks with an external cornerstone investor who will commit £400m to launch its Hermes Real Estate Senior Debt Fund.
Hermes plans to originate and deploy between £750m and £1bn per year through the fund by co-investing in loans of between £30m and £100m on terms of up to seven years.
It will focus on offices, retail and industrial properties in London and the South East, but will also lend “opportunistically” on prime regional assets – all at loan-to-value ratios of up to 65%, and provide loan-on-loan finance at LTVs of up to 60%.
The fund will be managed by Marcus Palmer, head of real estate debt, who was appointed in June to head Hermes’ push into the debt markets.
He joined from Chalkhill Partners, a boutique firm specialising in structured finance for real estate. Prior to this, he was with Nama’s UK restructuring team.
