Bank funds are available

As is known, some developers suffer from lack of financing sources which prevent to start planned projects. It also reffers the Katowice’s development of Silesia Towers. Many says that todays slowdown in building investments will finish with start of bank funds availability. As we can read below, bank representatives claim that there is funding available. Maybe it is time to look for financing more actively?

“There’s a general recognition that yield convergence went too far in Central and Eastern Europe, but the final panel of CEDEP 2009 was devoted to the question of which way the investment markets are now headed.

At the moment, panelists agreed, the markets are going exactly nowhere, but the discussion revealed reasons to believe that this absolute stagnation could gradually give way. Unexpectedly, the most encouraging signs of this view came from bankers during an extended question and answer session. Markus Leininger, Eurohypo’s head of corporate banking in Central and Eastern Europe, said that his bank’s credit lines had been opened for Poland, but that it would take time before this started producing visible results.

He described quite openly how he’d called up a client to tell him there was money available. “There was a bit of silence on the other end. Then he said, ‘Markus, I haven’t heard from you for a couple of months and now you say you have money? Do you expect me to have product ready?’ He said the market would now restart, but very slowly. “I don’t expect anything to happen materially before the summer break. After that I think there will be much more activity.”

Asked by moderator Alan Colquhoun, DTZ’s managing director in Warsaw, about the lot sizes on offer, Leininger said he was looking for deals of between €25m to €100m.

Maciej Tuszyński, executive director of Westdeutsche ImmobilienBank’s Warsaw operations, objected to the general belief that banks are holding up the market. “This is the most frequently used excuse, that there’s no bank financing. But that’s not right,” he said. “There is bank financing available at certain terms and we’d be more than happy to finance an investment deal. But there’s nothing happening. We can’t buy ourselves a property to finance.”

Michael Kröger, Helaba’s head of real estate finance for Northern and Central Europe, was less sure about how long it would take for the markets to revive. “All the predictions have been wrong. Since the beginning in 2007, people kept saying to wait until next year, then the next quarter. Now we’re saying end of 2010 maybe 2011. But it’s all a guess at the moment,” he said.

But he, too, objects to using banks as the fall guy for the market’s difficulties. “It’s always the banks’ fault. When the market is going up, the banks are too inflexible or too slow or too expensive, and when they go like this they have been too expansive in the past and are too prudent currently.”

Source: CiJ Journal