At the time of his accession to the dogeship, Venice was engaged in the second Ottoman–Venetian War, which started in 1499. Loredan had lost his cousin Andrea Loredan, a naval officer in the disastrous Battle of Zonchio, and the war had proceeded badly on land too, with the Venetians losing considerable territory. This included the strategic city of Modon, which was the site of a bloody battle involving hand-to-hand combat, followed by the beheading of hundreds of Venetians following the Turkish victory. The war took a heavy toll on the Venetian economy and in 1502–1503 Loredan agreed a peace treaty with the Turks. He was helped in the negotiations by Andrea Gritti, a Venetian who had been conducting trade in Constantinople and would later become doge of Venice himself. Venice paid a high price for this treaty including loss of land and a requirement to pay an annual tribute to the Turks.