Japan Major Report - Lender Survey 2022

Lenders’ Concerns Shift from the Pandemic to Rising Interest Rates

• The greatest threat facing the debt market for the next year is “domestic and global economic shock”. The number of respondents who indicated that “interest rate rises” and “global political instability” are major issues also recorded sharp increases over the previous year.
• The outlook for the next year in the debt market showed improvements in all categories, including “property prices”, “LTV” and “loans to REITs”. The diffusion index for each of these three categories returned to pre-pandemic levels.
• New loan volume is expected to increase once more in 2022.
• The most attractive asset type remains “logistics facilities” for the third consecutive year. The evaluation of “offices” also showed improvement among senior lenders.
• Lending criteria (for senior lenders) eased for all asset types, including the retail and hotel sectors.
• Lenders either adopting or considering the adoption of ESG criteria are on the rise.