Since the process began in January 2023, Starwood European Real Estate Finance (SWEF) has now returned £256m to investors, equivalent to 61% of its NAV at that time. £46m of this was distributed in the first half of 2025, supported by the full repayment of a £47.3m UK hotels loan. After the period end, two further loans – Hotel, North Berwick and Life Science, UK – were repaid in full, returning an additional £29.1m although, as noted in today’s morning briefing (click here to read), SWEF has announced a further write-down on its loan secured against a Central Dublin office portfolio.

As at the date of the announcement, SWEF’s portfolio is down to four remaining loans. Three of these are considered Stage 1, the lowest risk category, while one – the loan secured on the Office Portfolio, Ireland that saw the above mentioned write down announced this morning – is classified as Stage 3. In August, the board wrote down the recoverable value of this investment to €4.8m, following non-binding discussions over a potential sale, which required a further €2.2m (£1.9m) impairment.

The average remaining loan term across the portfolio is now just 0.5 years, with the final maturity expected in Q3 2026. The company continues to generate strong cash flow, supporting an annual dividend of 5.5p per share (a 6.3% yield on the 30 June share price). Most of the portfolio (77.7%) is on floating rates with floors, offering some inflation protection, while the weighted average loan-to-value stands at 69.9% (or 57.7% excluding the impaired Irish loan).

Chairman John Whittle said he was pleased with the progress made in returning capital, noting that the loan book had been reduced from 12 at the start of 2023 to just four today. He added that while most of the portfolio remains low risk, the board and investment adviser are continuing to monitor and manage the Irish office loan closely to maximise recovery.