M&G Investments deployed £2.2bn ($3.13bn) in European real estate commercial loans in 2015 across 24 separate loans covering all sectors – including a first development loan.
This brings M&G's total real estate debt investments since 2010 to £5.5bn.
An additional £750m was raised from external institutional investors and pension funds for investment in senior commercial mortgage loans.
M&G Investments is the London-headquartered investment arm of Prudential Plc in the UK and Europe. M&G manages more than £247.5bn in assets through various investment strategies.
"This has been our most active year in the market post the global financial crisis as there continues to be increasing demand for alternative methods of funding real estate in the UK and continental Europe," said John Barakat, head of real estate finance, M&G Investments.
"Institutional investors' search for yield and security has ensured that real estate debt remains in the spotlight and these investments continue to offer among the most attractive relative value opportunities in fixed income."
He added that given the current market dynamics and investor demand, he foresees "further capital raising across junior and senior real estate debt strategies this year."
Almost £2bn was deployed during 2014, a spokesperson told Insurance Asset Risk, who added that the capital raised and deployed came predominately from external, third-party funds.
Increasing volume of CRE loans
According to CBRE Capital Advisors, a building consultant, the volume of European commercial real estate (CRE) loans across Europe increased by €23bn over the course of 2014.
"The combination of the slow pace of deleveraging, the rise of alternative lenders and leverage-hungry private equity buyers may lead to a further increase in European CRE debt levels in the short term," their 2015 European Commercial Real Estate Finance report says.