This time last year, the coronavirus crisis was being considered the first major test for the private real estate debt sector since it emerged in earnest in the last property cycle.

If this year’s Real Estate Debt 50 ranking is an indicator, then it is a test passed. In aggregate, the 2021 iteration of the ranking garnered $190 billion, some 20 percent more than at the last count, which was published just as the pandemic was taking a global grip. Increasingly, institutional capital is seeking the relative safe havens of credit positions as the real estate asset class still demands sustained investment to ensure these investors can meet their liabilities.

As this year’s ranking demonstrates, investors’ flight to the safer confines of the debt part of the capital stack is matched with their congregation with marquee names, as they are doing with equity-based strategies. Indeed, approximately two-thirds of the money raised by this year’s RED 50 was raised by the top five managers alone. In the past year, more than 44 percent of the total capital raised for real estate debt strategies was for second-placed Blackstone’s $8 billion Blackstone Real Estate Debt Strategies IV alone. Blackstone’s fund was one of 23 raised in the past 12 months, a marked drop on the 40 vehicles raised in the previous year.

What does that mean for institutional appetite for property credit? When it comes to the traditional, commingled funds measured in the RED 50, the vehicles are getting bigger but are being raised by fewer managers.

Outside of the ranking, there is a growing appetite for debt strategies wrapped in direct separate accounts or joint venture vehicles.

But these two subplots are parts of an overall story about the real estate debt sub-sector growing ever more popular with investors; a story with a long way to go.

Click here for the ranking methodology