What you need to know

Market uncertainty has reduced property investment flows from European investors to the UK, but London still receives the highest volume of investment property activity of any European city and remains the highest priority target from investors located outside Europe.

During 2018, new loans totalled an estimated £49.6 billion, up by 11% on 2017. This total was underpinned by a strong second half of the year, with loan originations having reached £22.5 billion in the first half of 2018 - 27% higher than the same period in 2017.

Given the volatility of commercial borrowing and the wider financial climate, projections for the value of the commercial mortgages market are heavily dependent on broader economic factors and the outcome of Brexit, which remains uncertain following the second extension of the Article 50 deadline and the possibility of another general election after the change in prime minister.

Growth is expected to be supported by continued foreign investment and robust occupier demand, particularly in the offices and industrial sectors.

Covered in this Report

This Report focuses on the UK commercial mortgage market, though market size data includes all lending secured by commercial property, including refinancing.

For the purposes of this Report, Mintel has used the following definitions:

  • Commercial property: all lending secured on UK commercial property and held on the balance sheet of lending organisations. This includes residential investment and development, but excludes owner-occupier residential mortgages.

  • Commercial property loan books: their net exposure to UK commercial property, excluding equity finance (i.e. net of any loan amounts sold down to other lenders and net of any securitised loans unless otherwise stated).

All values quoted in this report are at current prices unless otherwise specified.

The term billion is used to represent one thousand million.

Some totals in tables do not add exactly due to rounding methods.

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