Asset and investment fund manager Capital Bay Group has launched an open-ended credit fund to provide finance for real estate development and investment across Europe.
The new fund, Capital Bay Europe Secured Whole Loan Fund, has been seeded with an initial 13 loans totalling €400m (£340m) on residential and commercial projects in and around London. A further €500m of loans are in the pipeline with a target fund size of around €1.5bn.
Alongside projects in London, the fund will also finance projects across France, Germany and Italy and has set itself an anticipated IRR of 6-8%.
Rolf Engel, chief finance officer of Capital Bay Group and chief executive of Capital Bay Fund Management, said: “We have seen during the Corona pandemic that traditional bank financing has declined, especially for project developments, due to the uncertainties in the market and regulations such as Basel III.”
He added: “Project developers are increasingly turning to whole loan from alternative lenders to finance their projects. The CBES Whole Loan Fund picks up on this demand and provides the necessary capital. We already have very high demand for this investment opportunity.”
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