Refinancing of property holdings - an underused lever to raise capital

Wednesday, 23 September 2009 15:31

The strength of the euro on the foreign exchange market makes the refinancing of property holdings particularly attractive. This can be done in order to finance projects in other countries.

The current environment is full of opportunities, particularly with regard to the refinancing of property holdings.

The definition of the refinancing of a property holding is a mortgage taken out on a property which has capital value in order to make use of the capital tied up in it. The obvious advantage is that the property is retained while additional income is obtained, which can be invested anywhere in the world. It also provides an opportunity to restructure and reorganise existing property holdings.

This arrangement is particularly attractive for properties located in France. There are two reasons for this. First of all, the French property market has declined less during the last two years than other countries, such as the United Kingdom, the United States or Spain. Secondly, the euro has strengthened against a number of other national currencies, including sterling and the dollar.