American banks aren’t lending to British property owners like they used to

Prices are at record highs, and North American lenders are growing more cautious

TRD New York /
Oct.October 11, 2017 09:20 AM

London

Lenders in North America and elsewhere are pulling back on credit they’re willing to provide for commercial properties in the U.K. as prices remain at record highs and uncertainty lingers over Brexit.

North American banks provided $861 million for commercial real estate in the six months through June, a 58 percent drop from the previous year, according to a survey of 78 lenders by De Montfort University. British banks and member-owned lenders advanced $10.8 billion for commercial properties in the first half of this year, a 14 percent fall from last year, Bloomberg reported.

“There is definitely more caution around property values,” Nicole Lux, senior research fellow at the university told Bloomberg. She said that loan-to-values “could quickly rise if prices fall.”

The demand for credit, however, has been curbed somewhat by Hong-Kong-based investors, who purchase commercial property with financing from domestic banks. Such deals were not reflected in the university’s survey. [Bloomberg] — Kathryn Brenzel 


Related Article

arrow_forward_ios

Real estate stocks push up this week as U.S.-China trade tensions ease

416 West 25th Street and Maverick Real Estate Partners principal David Aviram (Credit: Google Maps and LinkedIn)

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case

Embattled Prodigy Network CEO Rodrigo Niño to step down

Larry Silverstein and the Tel Aviv Stock Exchange (Credit: Getty Images)

Institutional investors swarm Silverstein’s new TASE bonds

Real estate firms get (green) thumbs down as they jump into climate bonds

With Fed rate cut on the mind, markets enter the week riding high

(Illustration by Carl Wiens)

NYC’s foreign investment landscape in the era of trade wars and heightened nationalism

New York Community Bank CEO and president Joseph Ficalora (Credit: Facebook, iStock)

Freed by Dodd-Frank, NYCB is on the hunt for M&A deals

arrow_forward_ios