Swedish real estate companies and developers have traditionally relied on generous bank financing for property acquisitions and developments. However, in recent years, the landscape for these players has changed significantly. Lending opportunities and loan-to- value ratios offered by banks and credit institutions have drastically decreased. This shift is primarily due to the mandatory Basel III regulations, which impose stricter capital requirements, and a general tightening of credit markets. Consequently, a substantial financing gap has emerged in the Swedish real estate market.

While large, established players have managed to bridge this gap through a mix of bond financing, increased equity contributions, and mezzanine funding from international credit funds and institutions, small and medium-sized companies have struggled significantly. Until now. Over the past few years, institutional credit funds, direct lending from institutions, bonds, and preference shares have become viable options for larger real estate players with access to financial markets. However, smaller and mid-sized companies still face limited financing alternatives.