Real Estate Insights: The debt funding gap in the European commercial real estate market

Steven Devaney

Journal of Property Investment & Finance, 2025, vol. 43, issue 5, 600-607

Abstract: PurposeThis real estate insights paper discusses how debt funding gaps can arise in commercial real estate markets and compares recent measurements of the funding gap for the European real estate market.Design/methodology/approachA review of largely practice-based literature is supplemented by worked numerical examples that provide transparency around how debt funding gaps have been measured at an aggregate level.FindingsRecent estimates of the European debt funding gap have fallen in the range of €85bn to €115bn. The figures typically represent 15–20% of the debt originated in the years before the market downturn.Practical implicationsAs well as creating challenges for existing borrowers and lenders, debt funding gaps can lead to inertia and reduce liquidity in the wider real estate market if refinancing situations are difficult to resolve.Originality/valuePrivate real estate debt remains an area that is under-researched in an academic context, and this review maps out studies and sources that could form the basis for future investigations.

Keywords: Debt; Interest rates; Lending; Leverage; Real estate; Refinancing (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/jpif/article/43/5/600/1296 ... t-funding-gap-in-the (text/html)
https://www.emerald.com/jpif/article-pdf/43/5/600/ ... f-08-2025-0101en.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:jpifpp:jpif-08-2025-0101

DOI: 10.1108/JPIF-08-2025-0101

Access Statistics for this article

Journal of Property Investment & Finance is currently edited by Nick French

More articles in Journal of Property Investment & Finance from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().