CREFC Conference Insights
Competition, Geopolitics, and a whole heap of AI
CREFC’s flagship event has come and gone for another year, with much of the same sentiment as last year’s, but this time around there feels like more meat on the bone and a better understanding of the new world in the second Donald Trump era. Held at the Landmark in London, the schedule was full to the brim of updates, insights, challenges, and opportunities for those brave enough to operate in the world of commercial real estate finance.
Liz Martins of HSBC opens the day in her usual engaging fashion, providing a background and baseline for the rest of the day and the global markets at large. A good sense of market sentiment appears to be following the money, and since the US has instilled its new Commander-in-Chief, the market seems to be much more positive on Europe in 2025, to avoid the volatility across the pond. That’s not to be so bold as to say Europe is booming, but the slightly more stable outlook is a safer bet for deployment, for now at least.
The remainder of the morning gives focus to raising and deploying capital, with insights from the likes of Apollo, PGIM, Deutsche Bank and Goldman Sachs. Strategies focused on living sectors appear to remain the most popular, with PBSA, BTR and Senior Living all of interest. There is still hype around the costly data centres, with the crossover in to whether it technically classes as real estate or infrastructure. Concerns around capital raising appear to have abated slightly, perhaps as a result of the geopolitical nerves settling, but deployment is where the struggle remains. With low transaction volume continuing, and entire market focus on fewer asset classes, when an appealing deal crosses the desks, the world and his wife are working to get the deal over the line. Squeezing margins, flexible covenant structures, higher LTVs are all part of the conversation for some. Risk, credit and investment committees will have their work cut out for them if the origination team’s stories are to be believed, and this appears to have been the case for quite some time. For those with a stricter appetite on risk, namely the banks, back leverage is the solution to those problems. More and more banks appear to be entering the world of back leverage, and whereas previously we might expect to see banks and debt funds on the opposite sides of the table, allegiances and partnerships continue to form as the reality of mutual benefit can no longer be denied.
The afternoon then gives way to the topic that has been lining the conversation throughout the day, AI. Perspectives from across the investment and service landscapes are given on how this new age of technology is helping firms streamline their business processes, assist in their modelling, and giving them a competitive edge in a very agile marketplace. Last year we heard about how people are putting in place AI policies and procedures, that businesses are preparing for this step, but not many had made concrete steps forward in to implementation of tools. This year however tells a different story. We hear about all manner of implementations, from the now household names of ChatGPT and Microsoft Co-Pilot, to original development and proprietary technologies. The day was littered with digital polls from people in the room and those participating online, and the overwhelming consensus when asked about AI at their own firms, most agreed that they are engaged in using some form of AI at work. Clearly the work on policies last year, has opened the doors to embracing the next chapter of technology.
If the final keynote session was anything to go by, the faith in AI appears to be well placed. Following a fascinating opening from Lord Kim Darroch, giving us a behind-the-curtain look at how politics is shaping our world, Piers Linney serves up a presentation that has one strong message. The AI boat is leaving, and you need to make sure you are aboard before you miss it. It’s both an exciting and stark message, as Piers talks us though how the AI of today is replacing the work of juniors, but fairly soon it will replace the work of many of us. He recalls a conversation he’d had whereby a friend of his had recently had a baby, and his comment was ‘How does it feel to know she will never have a job?’. Estimes vary as to when AGI (Artificial Generative Intelligence) will be widespread, but Piers is of the opinion that it will be sooner rather than later.
This conference confirms the validity of the ideas that Altrium was borne out of. Launched with proprietary technology and AI integration, Altrium is enabling our clients to become more efficient, more profitable, and more competitive than before. Relationships are at the heart of this industry, and for a deal to be done there needs to be a great deal of trust running through it. Our senior team of experienced individuals bring skills and relationships to the table, whilst our technology serves as a platform for continuity of service. Altrium’s offering is changing the landscape in the industry by being more than just a requirement as part of a deal, but bringing true value and real ROI for our clients.
If you are looking for the next generation of transaction support, get in touch with our team today to find out how we can make a difference to your next deal.