 |
Pierre Rolin, Stratreal: double whammy ahead |
"To me, distressed means properties where the banks have pulled the rug on someone and it’s vacant, or in development and the builder hasn’t been paid," says Michael Cutteridge, director of DTZ’s capital markets team in London. "I don’t think we’ve gotten to that point yet. It’s more the case of buying good properties at better pricing and there being fewer people in the market."
This is a point underscored by Nick Burnell, managing partner at Rutley Capital Management in London. Although prices have come down, they haven’t come down to distressed levels. "No one knows what the volumes of opportunities will be," he says. "It could be that the money coming in will underpin the market. I’m not sure this is an environment where people will make lots of money."
Nevertheless, in the UK, where commercial property prices have dropped by some 20% to 25%, many players are positioning themselves to scoop up bargains. London-based Rocksburgh Capital, the direct investment arm of Rock Capital, is raising €500 million to invest in property-related subordinated debt and loans – some of which might have been packaged in commercial real estate collateralized debt obligations that are being dismantled.