Chart of the week: Real estate debt skyrockets in H1

Fundraising for the sub-sector rose by 47 percent from H1 2015 to H1 2016 while corporate debt capital dropped for the first time in six years.


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Private real estate debt has hit a record high for capital raised in the first half of the year, as reported by Private Debt Investor. A total of $18.9 billion has been raised for the sector in H1 2016, a 47 percent increase on H1 2015.

As strong performance encourages investment into private real estate debt funds, macroeconomic uncertainties have dampened investor demand for corporate debt. Typically the industry’s largest and strongest sub-sector, corporate debt has experienced its first H1 fundraising decrease in six years. Funds for the strategy amassed $26.2 billion.

There has been a drastic reduction in North America-focused corporate debt in the first half of 2016. In H1 2015, $14.4 billion of corporate debt capital was focused on North America, compared with less than $5 billion this year. There has instead been a shift towards Europe-targeted investments by corporate debt vehicles, with 28 percent of capital focusing on the region despite post-Brexit turmoil.