Prime assets remain a borrower’s market

European real estate lenders still have liquidity and are willing to offer competitive financing for prime assets, despite persistent inflation and higher interest rates, according to Duco Mook, head of treasury and debt financing EMEA at CBRE Investment Management.

Speaking to Real Asset Insight at EXPO Real 2026, Mook said: “The mood changed a little bit over the summer with sticky inflation and higher interest rates. But I think overall the liquidity is still there.”

“The lenders continue to serve us. They have the liquidity. For the prime product, it’s actually still a borrower’s market with very competitive pricing although obviously the all-in cost of that has absolutely increased with higher base rates which probably is here to stay for a bit of a longer term.”

“I definitely see opportunities to be more creative and think along with the lenders either for shorter term tenors, either be more flexible on the hedging structures,” he said.

Banks were also showing greater flexibility over interest coverage ratio (ICR) covenants, giving borrowers additional headroom to accommodate higher debt servicing costs. Mook said close cooperation between borrowers and lenders could help achieve better financing outcomes.

Turning to investment opportunities, he said: “The hotspots, I would say ultimately it’s really about the enhanced business plan. So where can we as an asset manager add value?”

“There could be a bit of leasing risk, there could be a bit of construction risk as well. But overall you want to add value in the long run and we do that with the very strong asset management capabilities that we have on the ground.”