Helaba, pbb and Münchener Hyp all in expansive mode

We report in this issue on a further decline in sentiment among German property financiers (see article on BF.Quarterly Barometer). However, not all traditional banks are retrenching completely from their regular financing hunting grounds.

Of the biggest lenders, Helaba announced recently that it plans to boost lending to about €10bn in 2018, well ahead of last year's €8.7bn, which itself was below that of 2016. New head of real estate banking at Helaba, Christian Schmid, told reporters recently that Helaba will take about €8bn on its own books, with the rest being syndicated to the bank's Sparkassen members, nearly a doubling of volume of last year's syndication.

Schmid also plans further concentration on financing project developments, with their higher margins, along with re-developments given the lack of available building land. The bank curently has a loan book of €34.4bn against commercial property, about half for offices and then, a good way back, for retail and residential.

Earlier this month Helaba provided €100m financing for VIA Outlets, an outlet village in the Netherlands in Lelystad near Amsterdam. The Batavia Stad Fashion Outlet opened in 2001, and currently has over 150 stores plus cafés and restaurants. Following an expansion in 2017, Batavia Stad Fashion Outlet comprises a total sales area of 31,300 sqm. Helaba is acting as arranger, lender, facility and security agent for the refinancing loan.

In Munich, lender pbb Deutsche Pfandbriefbank provided an investment facility of €74m to retail investor Newbridge to fund three shopping centres in Poland. The three malls are Bielawy in Torun, Guliwer in Lódz and Czyzyny in Kraków. The 72,000 sqm portfolio is nearly fully leased, with Carrefour Polska as the anchor tenant on long leases for all three centres.

According to Charles Balch, head of international clients, UK & CEE at pbb, "The retail segment is undergoing a number of changes, as we all know. So we are pleased to work with clients like Rory Mepham and the Somerston group, the founders of Newbridge, both of whom have extensive experience in this market,."

Newbridge was established in 2015 as a wholly owned subsidiary of the Somerston Group, a real estate investment and development company headquartered in Jersey, Channel Islands. Headquartered in Warsaw, it focuses on regional retail parks and shopping centres in Poland.

Further news from Munich is that lender Münchener Hyp booked a record year of new lending in 2017 with €5.1 of new loans. The bank is a big lender against residential property. In the private residential sector it lent €3.2bn last year, against €3.3bn the previous year, while commercial lending rose 13% to €1.9bn. As with pbb Deutsche Pfandbriefbank, Münchener Hyp has been boosting its business in the USA.

Münchener Hyp's lending is strongly underpinned by the healthy state of the Pfandbrief market for refinancing, as evidenced recently when a €500m 10-year benchmark Pfandbrief was topped up by a further €250m just months after its original issue. The bank also issued a number of smaller Pfandbrief covered bonds totalling a further €750m with a duration of nine years and two months.