Since the 2008 crisis, mid-sized companies have often come up
short when it comes to growth finance, due to banks lowering their
levels of debt financing and opting instead for more established
borrowers. Combine this with the high price of assets nowadays, and
the low-interest-rate environment, and we find companies—and
indeed everyone—looking high and low for new sources of
yield.
The fruits of these searches are increasingly in the same area:
debt.
Debt funds are on a serious uptick in Europe, with more and more
deals each year since 2008. But why debt? Its success seems to have
come about by a convergence of private equity and real estate:
those in private equity have the experience in debt financing,
while those in real estate are finding real estate too pricey to
get to their desired yield and have thus also sought refuge in debt
investment. Debt investment can also be less risky than owning the
real estate outright if done properly, which has further
