LPP legal guidance steered LBBW through restructuring in property loans sector
In a significant move, Landesbank Baden-Württemberg (LBBW) has fully integrated Berlin Hyp's commercial real estate finance activities as of August 1, 2025, following its acquisition in summer 2022. The integration has positioned LBBW as a major player in commercial real estate finance in Europe.
The real estate finance business now operates as an independent organizational entity within LBBW, under the Berlin Hyp brand. This merger has formed one of Europe's largest commercial real estate financiers, with a financing portfolio of around €63 billion.
The integration involved transferring all Berlin Hyp’s creditor and debtor relationships to LBBW, merging their public and mortgage cover registers, and making LBBW the issuer replacing Berlin Hyp AG. LBBW also expanded Berlin Hyp’s international footprint by opening new branches in France and the Netherlands, plus a representative office in Poland, to support ongoing business in these countries.
The combined mortgage cover pool, dominated by commercial mortgage loans, has benefited from reduced concentration and currency risks, thanks to Berlin Hyp’s portfolio. However, the merger also increased LBBW’s relative exposure to riskier commercial mortgage assets versus residential ones. The combined cover pool's low arrears levels reflect strong credit quality, with Berlin Hyp's contribution lowering overall credit risk for LBBW’s covered bonds.
Berlin Hyp, now part of LBBW, remains innovative in the sector. For example, it successfully issued the first blockchain-based digital Mortgage Pfandbrief in 2024, indicating continued leadership in digital real estate finance solutions.
Global law firm White & Case LLP advised LBBW on its realignment in commercial real estate finance. The White & Case team, operating in various regions, provided advice on corporate, regulatory, employment, capital markets, real estate, and general banking law for the transaction.
With the regulatory and legal incorporation now complete, LBBW has taken on all Berlin Hyp AG's relationships involving a creditor or debtor position with effect from August 1, 2025. The acquisition of Berlin Hyp in summer 2022 marks a key milestone in the integration process for LBBW.
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- The merged entity, now a significant player in Europe's commercial real estate finance industry, has a financing portfolio of approximately €63 billion.
- The merger between LBBW and Berlin Hyp has created one of Europe's largest commercial real estate financiers.
- The integration of Berlin Hyp's commercial real estate finance activities into LBBW was completed on August 1, 2025.
- LBBW has taken on all Berlin Hyp AG's creditor and debtor relationships as part of the integration.
- The merger has reduced concentration and currency risks in the combined mortgage cover pool, primarily composed of commercial mortgage loans.
- The acquisition of Berlin Hyp by LBBW in summer 2022 was a key milestone in the integration process for LBBW.
- The newly integrated real estate finance business operates as an independent organizational entity within LBBW, with Berlin Hyp maintaining its brand.
- LBBW expanded Berlin Hyp's international footprint with new branches in France and the Netherlands, and a representative office in Poland.
- The low arrears levels in the combined mortgage cover pool indicate strong credit quality, with Berlin Hyp's contribution lowering overall credit risk for LBBW’s covered bonds.
- Berlin Hyp, previously an individual entity, has demonstrated innovation in the sector by issuing the first blockchain-based digital Mortgage Pfandbrief in 2024.
- Global law firm White & Case LLP provided legal and regulatory advice for LBBW's realignment in commercial real estate finance.
- The White & Case team offered advice on various areas of law including corporate, regulatory, employment, capital markets, real estate, and general banking for the transaction.
- This significant move in the commercial real estate finance industry is covered in various business, finance, and news sources, including [link to sources 1, 2, 3, 4, and 5].
