Deutsche Bank is in the process of preparing the first CMBS secured against Portuguese real estate this cycle.
The CMBS will include loans extended to Baupost and Blackstone as well as other borrowers. The deal is expected to be marketed this summer.
Investment banks are looking to the country in order to undertake higher-margin lending, away from the intense competition in most other European jurisdictions. The forthcoming CMBS also illustrates the continued need for securitisation as an exit for lenders in more challenging countries, as opposed to traditional syndication.
Deutsche Bank has extended a loan of around €100m (£71.7m) for Baupost’s and Eurofund Investments’ €170m purchase of the 1.3m sq ft Dolce Vita Tejo shopping centre in Amadora from ING. The five-year loan reflects a loan-to-value of close to 59% at a margin of close to 350bps.
An additional mezzanine loan has been issued to the buyers of Portugal’s largest mall of around €25m by Highbridge Principal Strategies, which is owned by JP Morgan Asset Management. The loan has an internal rate of return of around 10% and sits at an LTV of 74%.
Deutsche Bank will also include some €150m of debt issued to Blackstone in the CMBS, which is secured against retail and logistics assets. The private equity giant has been buying aggressively in the country over the past six months. This week it purchased the Almada Forum near Lisbon, valued at €436m at the end of last year, from a fund managed by Commerz Real – the largest deal in Portugal since the downturn.
Deutsche Bank has led the way in restarting the CMBS market. In March it issued the €175m Deco-2015 Harp, which is secured against Irish real estate, and in September last year it issued the €250m Deco-2014 Tulip, secured against Dutch real estate assets.
