LMA launches German single currency document for transactions
The Loan Market Association (LMA) gathered for the second year in a row in Munich on 24th November for its Munich Real Estate Finance Conference, attended by over 180 finance professionals.
Among the LMA's key objectives is the promotion of syndicated loan products in the EMEA region, and its Munich event real estate event focuses on the opportunities and challenges facing the German real estate finance market.
Apart from a wide-ranging programme of presentations and panel discussions, the LMA launched its new German law real estate finance document – a new recommended form of euro currency term facility agreement under German law, intended for use in real estate finance multi-property investment transactions to be documented under German law.
The documentation project was begun in response to demand from German participants for a German law governed form of real estate investment facility agreement for the German real estate finance market (including the German Pfandbrief market), in much the same way as the LMA provided facility agreements for the real estate finance markets in England and Wales and Scotland.
The German document uses the same basic structure and "boilerplate“ as the LMA recommended form of facility agreement for the German law investment grade market or, where relevant, the English law real estate finance documentation. It was put together and agreed by an experienced working party, consisting of representatives from major German and international banks (including Pfandbrief banks) and German law firms. The document also sets out drafting options to determine suitability of the facility for registration in a Pfandbrief bank’s cover register (Deckungsregister).
Commenting on the document, Clare Dawson, LMA Chief Executive, said: "Real estate finance forms a significant part of the syndicated loan market and is a key contributor to economic growth. The LMA remains committed both to fostering REF liquidity and assisting its members who are active in the market. We hope that the addition of a German law real estate finance facility agreement to our existing suite of REF documents will lead to more efficient and productive negotiation of documentation.“
"The new German REF Document demonstrates our commitment to expanding our documentation library in the real estate sector and is representative of the LMA's increased activity in this area of the market. Following a significant rise in both overseas and non-bank investment in the German commercial real estate market, we hope that the document will contribute to attracting new entrants to the market.“