Join SCI for the Second Annual European CRE Finance Seminar
A booming private credit market is fuelling appetite for back leverage financings in the European commercial real estate sector. However, as the credit cycle continues to evolve, some of these arrangements are becoming stressed. SCI’s 2nd Annual European CRE Finance Seminar takes an in-depth look at the tools and strategies being utilised by back leverage providers to address financings that are under pressure, as well as the differing frameworks across a variety of European jurisdictions. These panels are book-ended by a discussion of the current state of play in the European CMBS market and an examination of the direction of travel for shadow lending.
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Agenda
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13:10 - 14:00European CMBS – setting the sceneIn the current challenging climate, liability management continues to be a focus across the European CMBS market.
- Which sectors are most exposed to the need for loan modifications?
- How are sponsors adapting to these challenges?
- Could ESG concerns drive the repurposing of space?
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Vantage Data Centers debuted the first European data centre securitisation in April. Which property types show the most promise for leading a return of new CMBS issuance, and why?
Panel Includes:
Daniel Peart, Pillar Point (Moderator)
Oliver Moldenhauer, Moody's
David O’Connor, Mayer Brown
Omar el Glaoui, Citi
Amar Majithia, Blackstone
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14:25 - 15:15Back leverage – addressing misalignmentAs the credit cycle continues to evolve and some CRE assets become non-performing:
- Which tools and strategies can back leverage providers utilise to address financings under pressure?
- Are mark-to-market and margining provisions performing as expected?
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Which other features and facilities are relied upon to protect lenders, especially in the context of misalignment between leverage and the underlying?
Panel Includes:
Sabah Nawaz, Cadwalader (Moderator)
Jon Farkas , Starwood Capital Group
Randeesh Sandhu, Precede Capital
Britta Drexler, Apollo Global Management
Alistair Aitken, NatWest
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15:40 - 16:30Back leverage – cross-border perspectivesWhen it comes to identifying the cross border issues in a back leverage financing, what immediately springs to mind are matters such as the governing law and form of the financing, the location of counterparties, the situs of assets, the prudential capital treatment and how to achieve tax neutrality in a creditor friendly way.- Is this a fair assessment?
- What are your thoughts on this and what else would you add?
In back leverage deals with a cross border element,- How important is the “downside” analysis?
- How workable is a “look-through” security package in a cross border setting and how unwieldy is the ability for a back leverage provider to actually “step in” and enforce?
- In practice, is this actually ever really an issue given the low probability of default?
The Irish perspective.- What are the key legal and practical considerations when using an Irish lender SPV in a cross border deal e.g., AML registration, credit servicing, credit reporting, other filings (SFTR, EU Sec Reg).
- Why is the use of Irish s110 vehicles attractive to:
- Back leverage providers.
- Back leverage users (especially US sponsors).
Form of financing. There are barriers to using repo in Europe (costs, extra structuring, enforceability concerns etc) compared to the US where mortgage loans can be repo’d directly in an MRA and benefit from the safe harbour against the automatic stay on enforcement in the Bankruptcy Code.- How important is the form of the financing in a cross border deal in terms of the regulatory/prudential capital treatment, for both the back leverage provider and the back leverage user?
What work-arounds enable SPVs to hold a loan without the vehicle being regulated?- How do banking monopoly laws impact the provision of back leverage solutions?
Panel Includes:
Richard Hanson, Cadwalader (Moderator)
Daniel Peart, Pillar Point
Maireadh Dale, Matheson
Gareth James, Ganymede Capital
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16:55 - 17:45Regulation – shadow lending in the spotlight- What does the regulatory landscape look like for CRE back leverage?
- What is the direction of travel for so-called ‘shadow lending’?
- How big is the market, and does the industry understand where the risks are?
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Which compliance issues are currently under the spotlight?
Panel Includes:
Nick Shiren, Cadwalader (Moderator)
Peter Cosmetatos, CREFC Europe
Taggart Davis, PGIM
Gordon Rowan, AlphaReal
William Trotman, BCLP
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