Venn targets €400m for whole loan in 2017 – exclusive

Venn Partners is looking to raise roughly €400m by the end of 2017 from investors looking to invest in whole loan pools of Dutch residential mortgages.

Venn Partners is seeing an increasing appetite for Dutch residential mortgages offered on a whole loan basis. The firm launched its Dutch residential mortgage platform, Venn Hypotheken, last year and is hoping to have issued approximately €800 million worth of mortgages by the end of this year.

The plan is to offer approximately half of these to investors on a whole loan basis, Gary Mckenzie-Smith, managing partner, told PDI. By 2018, the firm hopes to have issued €2 billion worth of mortgages. Roughly two-thirds of this amount is expected to be funded through whole loan investments rather than being securitised.

Rather than offering investors access to tranches of a securitised portfolio of mortgages, whole loan investments give exposure to the entire pool of mortgages without an equity holder below the investor. Pools of mortgages like this are popular with insurance companies and pensions, Mckenzie-Smith noted, particularly those in the Netherlands.

Mckenzie-Smith said Venn would offer exposure to the whole loan portfolios via separately-managed vehicles for larger investors. Venn is also open to launching a fund vehicle to allow groups of smaller investors to access the investment, though no concrete plans have been made as of yet.

The firm securitised a €500 million portfolio of mortgages in 2014. The portfolio was purchased from GE Artesia Bank in 2012 with the transaction closing in 2013.

Since the establishment of the Venn Hypotheken platform, Venn has written €200 million in residential mortgages. The firm anticipates this will rise to €350 million in the next three months or so. It has an application pipeline of approximately €150 million.

Venn is planning on securitising these mortgages over the summer, Mckenzie-Smith added. The exact date of the financing will depend on how much issuance the firm has between now and then.