Austrian property company Bundes Immobilien Gesellschaft (BIG) has raised €750m in Europe’s largest unsecured bond issue by a property company.
BIG, which is owned by the Austrian government, issued 10-year Aaa rated bonds with an interest rate of just over 4.3%,
in a shift from traditional bank lending towards funding in the bond markets.
Nick Jacobson, managing director at Deutsche Bank, which advised BIG, said other property companies would follow suit, even without the government ownership that BIG benefited from. “Investors looking for stability are seeking unsecured bonds, and the government is not issuing that many,” he added.
The issue, BIG’s second, has also enabled it to diversify from its home investor base towards a broader group of lenders.
