The UK commercial real estate finance market has become significantly fragmented over the last 10 years.
Long gone are the days where it was dominated by the big clearing banks and building societies.
Although a number of these institutions remain active in the market (particularly in asset classes such as housing and student accommodation) there has been a quite seismic shift in the UK Commercial Property Loan book over the last 10 years. Grosvenor's entry into this market is just another example of this.
Some will point to the ten year anniversary of slotting (the practice by which banks are required to hold capital and regulate their loans into certain categories of risk) as the key driver for this change. Some will say that it is merely opportunistic and many traditional property companies now see debt as a more attractive way to make a return.
Either way the increase in competition, hopefully against a landscape of lower interest rates (fingers crossed), is a positive story for the UK Commercial Property Market.
The company’s push into lending comes at a time when many real estate investors are finding debt to be a more attractive way to put money to work in property, compared with buying assets outright or developing themselves.
https://www-ft-com.ezphost.dur.ac.uk/content/c15baab1-4423-4e4a-9774-8075875c81a9