Challenges and Opportunities for Real Estate Credit Investments in Private Credit Market

Hardman & Co Research has released a new report focusing on Real Estate Credit Investments (RECI) amidst the growing prominence of private credit in global financing markets. The report identifies several positive implications for RECI. Notably, the disintermediation of banks reinforces RECI's business model. This shift is likely to enhance market sentiment, and RECI's competitive advantages compared to banks remain valid against private credit funds.

However, potential challenges are also highlighted. Increased competition is anticipated, particularly for high-value loans and skilled staff. Despite this, RECI occupies a niche that larger funds may overlook. Lastly, the likelihood of credit losses in substantial private credit funds could negatively impact overall market sentiment.