Real Estate Holds Ground Amid Restructuring
Real estate represented around 15% of sector-specific deals in our data, underscoring its continued relevance despite restructuring cycles. Fitch Ratings noted in May that stronger APAC credits continue to attract capital, though funding conditions remain uneven across markets. This mirrors our observation that property-backed financing remains active, but resilience varies by jurisdiction.
The steady presence of real estate demonstrates its role as a stabilizer within the broader financing landscape. Even as other sectors experience volatility, real estate remains a reliable anchor for deal activity. This resilience is particularly important in markets where restructuring cycles are ongoing, creating both challenges and opportunities for lenders and borrowers. For practitioners, the lesson is clear: real estate continues to offer dependable deal flow but requires careful navigation of local market conditions.
Timing Skew Reveals a Pause in Confidence
Opportunities in H1 were heavily front-loaded. Our data showed that 75% of deals were received in Q1, while only 25% were concentrated in Q2. This distribution highlights a strong start to the year, with mandates arriving early, followed by a lighter pipeline later as geoeconomic uncertainty and volatile interest rates weighed on sentiment.
For practitioners, the key takeaway is that timing reflects sentiment as much as structure. The bulk of opportunities arrived early, showing strong initial confidence. The lighter Q2 pipeline does not show structural weakness but potentially hesitation, requiring readiness to act when confidence improves.
Outlook Points to Rebound Potential
We have already felt an uplift in activity since July, and looking further ahead, we expect activity to regain pace as dry powder continues to build. Defaults are likely to taper, while restructurings will remain concentrated in specific markets. We will continue to monitor the flow of renewable energy deals to assess if they will attract more capital. Real estate is expected to remain active, balancing restructuring activity with new financing opportunities.
Diversification into digital infrastructure, particularly data centers, is an area to watch. This was reflected in our recent private dinner where strategic growth opportunities for AI were identified, with caution against the risks of overexpansion in AI hardware that could create local market disruptions. Disciplined structuring and strong governance should help investors navigate these opportunities.
The second half of 2026 will test the balance between optimism and caution. Practitioners should expect renewed activity once confidence returns but also prepare for uneven recovery across markets. The ability to compare, contrast and interpret signals from both deal flow and external commentary will be critical in navigating this landscape.
Disclaimer: The information presented reflects deal flow observed by Kroll’s Agency and Trustee Services business in Asia during H1 2026. It is based on internal tracking of opportunities and is intended as a snapshot of activity we have seen. This dataset does not represent market wide volumes or outcomes and should not be interpreted as comprehensive industry data.
