Forum for Science, Industry and Business

Financial Experts Predict Lower Volumes of Distressed Real Estate Loans

The trend of parameters such as gearing ratio, debt maturities, and financing volumes suggest that banks do currently prefer to extend their loans than to dispose of them. At the same time, fewer banks are expanding their new business in the German market.

This is the main outcome of the “Survey on the State of Real Estate Financing and on the Distressed Real Estate Debt Situation in Germany” conducted by the research centre “Distressed Real Estate Debt” jointly operated by CORESTATE Capital AG and the Real Estate Management Institute (REMI) of the EBS Universität für Wirtschaft und Recht.

„The present opportune interest rate is certainly one reason for the low number of distressed real estate portfolios currently on the market. Banks are provided with an abundance of capital since the European Central Bank announced its bond buying program. Therefore, the pressure on banks to sell their non-performing loans has decreased“, explains Ralph Winter, founder of CORESTATE Capital AG. "Nonetheless, distressed real estate assets will continue to be put on the market and their state can only be improved by a professional approach to real estate management, allowing for a stabilisation and repositioning of such portfolios."

The research focuses on assessing the current financing sentiment in the real estate market from the banks’ perspective. This survey follows last year’s research undertaken by the CORESTATE Research Unit for Distressed Real Estate Debt. „This year's survey shows how significantly the sentiment in the market can change within one year", says Prof. Dr. Nico B. Rottke, Founder and Head of the Real Estate Management Institute of the EBS University for Economics and Law. „This underpins our plan to repeat the poll on an annual basis. This way we are able to analyse the parameters of the market for distressed real estate assets and assess the significance of non-performing loans."

Almost 60 leading personalities, such as CEOs, CFOs, and Managing Directors, from 32 commercial real estate financing institutions received the questionnaire. The total assets of the banks participating in the poll add up to approximately € 2,563 bn. representing 72% of all assets from all CRE financers based in Germany. „Our survey shows that the financing landscape is still in a structural change“, emphasises Prof. Dr. Rottke. "Banks continue to implement regulatory measures and impose higher capital requirements or scale back their activities completely."

The research centre intends to use these findings as a basis for further scientific studies. It is also planned to repeat the poll annually in order to make industry developments and trends transparent and accessible to all stakeholders.

Daniela Harnisch | idw
Further information:
http://www.ebs-remi.de/cc_capmarkets/

Im Focus: Climate satellite: Tracking methane with robust laser technology

Heatwaves in the Arctic, longer periods of vegetation in Europe, severe floods in West Africa – starting in 2021, scientists want to explore the emissions of the greenhouse gas methane with the German-French satellite MERLIN. This is made possible by a new robust laser system of the Fraunhofer Institute for Laser Technology ILT in Aachen, which achieves unprecedented measurement accuracy.

Methane is primarily the result of the decomposition of organic matter. The gas has a 25 times greater warming potential than carbon dioxide, but is not as...

Im Focus: How protons move through a fuel cell

Hydrogen is regarded as the energy source of the future: It is produced with solar power and can be used to generate heat and electricity in fuel cells. Empa researchers have now succeeded in decoding the movement of hydrogen ions in crystals – a key step towards more efficient energy conversion in the hydrogen industry of tomorrow.

As charge carriers, electrons and ions play the leading role in electrochemical energy storage devices and converters such as batteries and fuel cells. Proton...

Im Focus: A unique data centre for cosmological simulations

Scientists from the Excellence Cluster Universe at the Ludwig-Maximilians-Universität Munich have establised "Cosmowebportal", a unique data centre for cosmological simulations located at the Leibniz Supercomputing Centre (LRZ) of the Bavarian Academy of Sciences. The complete results of a series of large hydrodynamical cosmological simulations are available, with data volumes typically exceeding several hundred terabytes. Scientists worldwide can interactively explore these complex simulations via a web interface and directly access the results.

With current telescopes, scientists can observe our Universe’s galaxies and galaxy clusters and their distribution along an invisible cosmic web. From the...

Im Focus: Scientists develop molecular thermometer for contactless measurement using infrared light

Temperature measurements possible even on the smallest scale / Molecular ruby for use in material sciences, biology, and medicine

Chemists at Johannes Gutenberg University Mainz (JGU) in cooperation with researchers of the German Federal Institute for Materials Research and Testing (BAM)...

Im Focus: Optoelectronic Inline Measurement – Accurate to the Nanometer

Germany counts high-precision manufacturing processes among its advantages as a location. It’s not just the aerospace and automotive industries that require almost waste-free, high-precision manufacturing to provide an efficient way of testing the shape and orientation tolerances of products. Since current inline measurement technology not yet provides the required accuracy, the Fraunhofer Institute for Laser Technology ILT is collaborating with four renowned industry partners in the INSPIRE project to develop inline sensors with a new accuracy class. Funded by the German Federal Ministry of Education and Research (BMBF), the project is scheduled to run until the end of 2019.

New Manufacturing Technologies for New Products