2 OCTOBER 2025
Valesco speaks to Immobilien Zeitung: “WE SOLVE THE PROBLEMS OF THE BANKS”
by Harald Thomeczek, Immobilien Zeitung - https://www.iz.de/finanzen/news/-wir-loesen-die-probleme-der-banken-2000037934
The London investment manager Valesco is negotiating the purchase of three insolvent office properties in Frankfurt, Düsseldorf, and Munich. ‘Our offer is always the best for the banks,’ says founder and CEO Shiraz Jiwa.
This spring, The Valesco Group secured €500 million from a U.S. bank for investments in and financing of distressed office buildings and projects in Germany’s Top 7 cities, as well as in London and Paris. Valesco can play across the full spectrum of the capital stack: from equity and preferred equity to mezzanine, senior loans, and whole loans. Jiwa’s main focus, however, is Germany.
Valesco is also working on some projects in Paris and London – but the greatest attention is directed toward Germany, says the investment manager who has grown his portfolio over the past six years to €2.5 billion, including assets in Brussels, Milan, and Paris. “Right now, we simply see more opportunities in Germany,” Jiwa explains, and clarifies: “There are more dysfunctional situations here.” He avoids the term “distressed,” which he finds too harsh as a catch-all. “But in Germany’s Top 7 markets, we see far more transitional assets stuck in dysfunctional holding structures than in other parts of Europe.”
Equity first, debt second
“We can work with developers when they are overleveraged,” Jiwa explains. Valesco then partially reduces their debt burden: the investment manager buys part of the senior loan from the developer’s financing bank – and thus takes a mezzanine position with a seat at the table. Through the mezzanine loan, Valesco secures a profit participation. The developer does not need to inject fresh equity, while the bank benefits from a reduced loan-to-value ratio. Jiwa is currently putting together exactly such a deal in Germany.
Still, he sees financing only as a secondary role. “We absolutely prefer the position of equity investor – that’s where we feel most comfortable,” says Jiwa, who brings 25 years of experience in European real estate markets and 12 years specifically in Germany. This is the position Valesco is targeting in three insolvent development projects in Düsseldorf, Frankfurt, and Munich.
Valesco writes tickets up to €100 million – or more
All three projects are insolvent and currently handled by administrators. According to Jiwa, Valesco is already in negotiations for the two insolvent office buildings in Frankfurt and Düsseldorf, while talks for the bankrupt property in Munich are still at an early stage. The deal sizes Valesco aims to strike with the U.S. bank’s funding in Europe range between €50 million and €100 million. “Occasionally, we can go significantly higher if a unique opportunity arises.”
Helping banks, not vulturing
And how much pain must sellers and creditors be prepared to accept when Valesco steps in? “Our offer is always the best for the banks,” promises founder and CEO Shiraz Jiwa – even though the institutions are willing to grant discounts of 30% to 40%, as in the two cases in Frankfurt and Düsseldorf, where negotiations are already advanced. “We are not vultures, but we help the banks solve their problems: our offer is always the best for them – and they recognize that.”
Jiwa admits he was actually surprised by how steep the discounts were that some lenders are prepared to grant in certain situations. The main reason, he says, is regulatory pressure: “This way, they free up capital for more profitable new business and don’t have to set aside much capital for loans in special situations.”
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