Starwood European Real Estate Finance Ltd (SWEF) 
SWEF: Quarterly Portfolio Update 
23-Jul-2021 / 07:00 GMT/BST 
Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 
(MAR), transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
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23 July 2021 
 
 
Starwood European Real Estate Finance Limited 
Quarterly Portfolio Update 
12.8 per cent Share Price Total Return During Q2; Resilient Performance from Robust Portfolio 
Annual dividend yield of 5.9 per cent, paid quarterly and expected to be fully covered by earnings 
 
Starwood European Real Estate Finance Limited ("SEREF" or "the Group"), a leading investor originating, executing and 
managing a diverse portfolio of high quality senior and mezzanine real estate debt in the UK and Europe, is pleased to 
announce a portfolio update for the quarter ended on 30 June 2021. 
 
Highlights 
 
  ? Income stability - all loan interest and scheduled amortisation payments paid in full and on time 
  ? Strong cash generation - the portfolio continues to support annual dividend payments of 5.5 pence, paid quarterly, 
    and generates an annual dividend yield of 5.9 per cent on the share price as at 30 June 2021 
  ? Portfolio robust - despite pandemic-related disruption, the portfolio continues to perform in line with 
    expectations 
  ? Borrowers remain adequately capitalised and are expected to continue to pay loan interest and capital repayments in 
    line with contractual obligations 
  ? On 22 April 2021 the Group announced that it had closed a GBP26.6 million floating rate whole loan secured by a 
    portfolio of four UK life science properties 
  ? On 21 July 2021 the Group announced that it had closed a GBP13.5 million floating rate whole loan secured by a 
    portfolio of a hotel and office complex in Northern Ireland 
  ? 12.8 per cent - Share price total return during quarter ended 30 June 2021 
  ? 46.5 per cent - Share price total return since inception in December 2012 
  ? The Investment Manager believes the current investment pipeline is the strongest since the Company was established 
 
 
Quote from the Chair, Stephen Smith 
 
"We are pleased to see that, as expected, the portfolio has continued to perform strongly and in line with 
expectations, with no disruption to loan interests and capital repayments despite the turmoil caused by Covid-19. This 
performance reflects the high quality of our portfolio assets and the counterparties to which we lend.   Our Investment 
Manager's expertise in originating, executing and managing a diverse portfolio of high quality real estate debt, backed 
by the scale and networks of Starwood Capital Group means that we can maintain an active pipeline of highly attractive 
opportunities to choose from. We are delighted to reiterate the annual dividend target of 5.5 pence, a yield of 5.9 per 
cent on the quarter closing share price. While the discount has narrowed in recent weeks the Board, the Investment 
Manager and Investment Adviser continue to believe that the shares represent very attractive value at the current share 
price." 
 
The factsheet for the period is available at: 
 
www.starwoodeuropeanfinance.com 
 
Share Price / NAV at 30 June 2021 
 
Share price (p)  94.0 
NAV (p)          103.6 
Discount         9.3% 
Dividend yield   5.9% 
Market cap       GBP384m

Key Portfolio Statistics at 30 June 2021 


Number of investments                                                       18 
Percentage of currently invested portfolio in floating rate loans           78.3% 
Invested Loan Portfolio unlevered annualised total return (1)               6.6% 
Portfolio levered annualised total return (2)                               6.8% 
Weighted average portfolio LTV - to Group first GBP (3)                       18.0% 
Weighted average portfolio LTV - to Group last GBP (3)                        63.5% 
Average loan term (based on current contractual maturity)                   4.7 years 
Average remaining loan term                                                 2.2 years 
Net Asset Value                                                             GBP423.7m 
Amount drawn under Revolving Credit Facilities (including accrued interest) (GBP11.0m) 
Loans advanced (including accrued interest)                                 GBP420.8m 
Cash                                                                        GBP1.4m 
Other net assets (including hedges)                                         GBP12.5m 
Remaining years to contractual maturity* Value of loans (GBPm) % of invested portfolio 
0 to 1 years                             83.5                20.0% 
1 to 2 years                             163.3               39.0% 
2 to 3 years                             29.1                7.0% 
3 to 5 years                             142.6               34.1%

*excludes any permitted extensions. Note that borrowers may elect to repay loans before contractual maturity. 


Country             % of invested assets 
UK                  43.3% 
Spain               29.1% 
Republic of Ireland 20.5% 
Netherlands         3.4% 
Germany             2.7% 
Finland             1.0% 
Sector           % of invested assets 
Hospitality      40.4% 
Office           22.2% 
Retail           12.7% 
Residential      11.2% 
Healthcare       6.0% 
Life Sciences    4.7% 
Light Industrial 1.3% 
Logistics        1.3% 
Other            0.2% 
Loan type     % of invested assets 
Whole loans   62.3% 
Mezzanine     37.7% 
Currency      % of invested assets* 
Sterling      43.3% 
Euro          56.7%

*the currency split refers to the underlying loan currency, however the capital on all non-sterling exposure is hedged back to sterling.

(1) The unlevered annualised total return is calculated on amounts outstanding at the reporting date, excluding undrawn commitments, and assuming all drawn loans are outstanding for the full contractual term. 15 of the loans are floating rate (partially or in whole and all with floors) and returns are based on an assumed profile for future interbank rates but the actual rate received may be higher or lower. Calculated only on amounts funded at the reporting date and excluding committed amounts (but including commitment fees) and excluding cash uninvested. The calculation also excludes the origination fee payable to the Investment Manager.

(2) The levered annualised total return is calculated as per the unlevered return but takes into account the amount of net leverage in the Group and the cost of that leverage at current LIBOR/EURIBOR.

(3) LTV to Group last GBP means the percentage which the total loan drawn less any deductible lender controlled cash reserves and less any amortisation received to date (when aggregated with any other indebtedness ranking alongside and/ or senior to it) bears to the market value determined by the last formal lender valuation received by the reporting date. LTV to first Group GBP means the starting point of the loan to value range of the loans drawn (when aggregated with any other indebtedness ranking senior to it). For development projects the calculation includes the total facility available and is calculated against the assumed market value on completion of the relevant project.

New Loans

On 22 April 2021 the Group announced that it had closed a GBP26.6 million floating rate whole loan secured by a portfolio of four properties. The properties consist of laboratory and office spaces let to a diverse range of life science occupiers in the UK. The financing has been provided in the form of an initial advance along with a smaller capex facility to support the borrower's value-enhancing capex initiatives. The loan term is 4 years, and the Group expects to earn an attractive risk-adjusted return in line with its stated investment strategy.

On 21 July 2021 the Group announced that it had closed a GBP13.5 million floating rate whole loan secured by a portfolio of a mixed use hotel and office property. The financing has been provided in the form of an acquisition loan. The loan term is 3 years, and the Group expects to earn an attractive risk-adjusted return in line with its stated investment strategy.

Dividend

On 23 July 2021, the Directors declared a dividend in respect of the first quarter of 1.375 pence per Ordinary Share, equating to an annualised 5.5 pence per annum. The Board is targeting a dividend of 5.5 pence per annum (payable quarterly) which it considers to be a sustainable level of dividend which should be fully covered by earnings over the year whilst ensuring the Group maintains strong credit discipline. The Company maintains a modest dividend reserve which can be utilised if required.

Portfolio Update

Interest & Amortisation Payments

All loan interest and scheduled amortisation payments up to the date of this factsheet have been paid in full and on time. This includes loans in sectors that have been most impacted by the pandemic, namely, hospitality and retail assets, where borrowers continue to remain adequately capitalised as previously reported.

Loan to Value

The Group's weighted average current loan to value is 63.5 per cent. This is measured against RICS red book standard valuation reports instructed independently of borrowers and are carried out by leading global property consultancy firms such as Savills, CBRE, JLL and Colliers. The weighted average aging of the date of these formal valuation reports is under one year (at 0.8 years). This means that on average across the portfolio, the loan to values are being marked against values that have been updated recently and since the onset of the pandemic. This gives further comfort around the robustness of the Group's position, with very significant equity cushions against the average loan basis.

Key updates are outlined below:

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