International real estate advisor Savills has today (4 October 2010) named the UK commercial property market's Top 12 'most active bigger ticket lenders'. These lenders, as listed below, are those who, according to Savills' enquiries, are both actively seeking and have actually achieved total new lending over the last six months of at least £100.0M in typical loan sizes of above £20.0M. Nine of the list are German lenders.

The named lenders all appeared in the firm’s previous list, published at Savills Financing Property seminar in June 2010*, citing the Top 30 'Active Lenders'. Savills reports that the total number of lending organisations actively seeking to lend in fact has increased since that time as new entrants have entered the property lending market. For example, a syndicate of French institutions who alongside ING financed Carlyle's purchase of the White Tower Portfolio in August 2010. That was also an example of a syndicated loan, which is an increasing trend particularly for loans above £50M which now tend to be shared between a club of like minded lenders. Few lenders will go above £100M on their own.

Savills has observed that many lenders with strong ambitions to lend are not realising those ambitions due to a combination of banks' strict lending criteria and a scarcity of suitable lending opportunities to satisfy those criteria. The firm emphasises that a number of other lenders have been active over the last six months but in smaller lot sizes, for example Handlesbanken, Investec and Nationwide BS, and therefore do not satisfy the current criteria of 'most active bigger ticket'.

Other lenders have made a number of loans above £20M but not in sufficient volume to meet the criteria of ‘most active’, such as BLME, Deka Bank, Deutsche Hypo and Landesbank Berlin, who continue to have no less of an appetite to lend. Many other lenders with existing property loan books have been very active working with existing customers and restructuring existing loans, in particular HSBC and Lloyds Banking Group.

William Newsom, UK head of valuation at Savills, says: “In the commercial property investment market there has been a reduced volume of properties coming to the market, and often those prime assets that lenders would like to lend against are being snapped up by non-debt-backed purchasers. The transaction markets are being dominated by equity players, leading to a scarcity of opportunities for lenders.”

Felix Rabeneck, director of Savills Central London Investment team, says: “There are unprecedented levels of investor demand for Central London investment property and it is lack of supply that has constrained the volume of turnover. The market this year has been largely driven by equity buyers who are in some cases favoured by vendors given the perception that debt is difficult to secure with lengthy approval processes. We estimate that of the ten largest deals in the City this year, six have been equity driven.”

Editors notes:

Savills list is compiled from a database of over 100 lenders.

Savills June 2010 list of 30 ‘Active Lenders’ was as follows: