Strange new beasts of lending

Guest blogger Nicky Richmond of niche property law firm Brecher looks at
the strange new beasties evolving to meet the gap left by traditional bank lending.

A few years ago, I used to act only for banks. They used to fall over themselves to lend on property. Sometimes they called it structured finance. Sometimes they lent up to the amount of the purchase price, sometimes more. Sometimes the borrower got mezz finance; sometimes there were equity investors; sometimes both. That was as exciting as it got. We used to do the ritual dance of the intercreditor deed and everyone went away happy (ish).

No longer. At the smaller end of the spectrum, there are only a handful of banks lending on development transactions. Many more lend on investment and at a level which would probably raise a few eyebrows – £150m anyone?

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