Real Estate Finance
Turkey is a promising country in real estate market. Principal reasons can be specified as;
- a large number of low quality houses’ being replaced by new ones,
- the recently introduced mortgage loan system’s huge growth potential,
- the important growth prospects for retail property thanks to immature retail market brings significant growth prospects for retail property,
- illegally constructed houses’ being demolished which directly reduce the supply.
Urban Renewal is the one of the most important sectors, which affects real estate finance market very positively. Urban Renewal and Development officially started in Turkey after the enactment of law no. 6306 “Renewal of Regions under Disaster Risks” in 2012. It is estimated that around 6.7 million units nationwide will be demolished and rebuilt over the next 20 years. Around TRY 44 billion (USD 15 billion) of financing will be required each year for urban renewal projects. In total, a budget of USD 400 billion has been allocated for this initiative, with the private sector taking the lead role.
Sources of housing finance are both institutional and non-institutional in Turkey. Project debt finance, housing loans and mortgages are the institutional financing means in Turkey. On the other hand, cooperative housing and equity sharing agreements are the non-institutional financing means of houses in Turkey.
We represent investors and developers seeking financing, as well as banks and lenders, on loans secured by all types of real estate, including office buildings; hotel, resort and hospitality projects; residential and mixed-use developments and industrial buildings.
We have broad experience in the areas of;
- Mortgage loans, construction loans, loans secured by real estate, cross-collateralized loans, sale-leaseback transactions and ground lease transaction
- Pre-development, permanent, mezzanine and carryback financings
- Inter-creditor agreements and co-lender arrangements
- Loan modifications
- Asset recovery and restructurings
- Commercial lending disputes
Our real estate finance practice ties in closely with our acquisition, disposition and land use practices. To that end, we bring together lawyers from our real estate, project finance, tax, securitization, litigation, public law and restructuring groups. Our experience of acting on all sides of real estate finance deals gives us a balanced understanding of how such transactions are structured and funded and enables us to adopt a flexible and commercially reasonable approach.