INREV: Growing funding gap fuels move toward debt funds
Recent analysis of INREV data sources — including the INREV Debt Vehicles Universe and the INREV Quarterly Fund and Asset Level indices — reveals a rapidly changing landscape for the European nonlisted real estate debt market.
This evolution is marked by a current funding gap. Around €36 billion ($39 billion) of assets are expected to come to the market in the next 10 years from the closed-end fund liquidation pipeline in the INREV Vehicle Universe alone, and the broader market estimates a €94 billion ($102 billion) funding gap, according to a AEW Research Monthly Report August 2023.
Current market conditions and higher cost of debt in the “higher for longer” interest rate environment have made the lending landscape more complex. After a decade of quantitative easing, the recent sharp and sudden shift to quantitative tightening has proven to be a shock