A number of factors ended the prolonged boom in European commercial real estate lending – rising interest rates, increased development costs, supply chain disruptions, increased home working and increased capital expenditure resulting from ESG taxonomy regulations. Many transactions financed in the boom years are reaching or approaching maturity. Many cannot be refinanced at sustainable interest rates. At the same time, there is uncertainty as to how best to address this situation. This article presents an overview of available options and underlying factors to consider for lenders on defaulted lending transactions involving German real estate.

Read the article