A 12% rise in commercial property transactions suggests the sector has staved off widespread fears around a potential Brexit, following a surge in funding from alternative finance lenders, according to Saving Stream, the peer-to-peer property funding platform.
Saving Stream said that commercial property transactions in May 2016 reached 10,790, a high since the credit crunch – up from 9,650 the same time the year before.
Saving Stream explains that the rise is in part due to the surge in funding of commercial property transactions by alternative finance providers, including peer-to-peer lenders. It says that alternative finance providers have been stepping in to fill the funding gap left by the regulatory restrictions limiting bank lending within the commercial property sector under Basel III.
Saving Stream highlights that the trend contrasts with the 12% decline in residential property transactions – from 101,850 in May 2015 to 89,700 in May 2016.
Saving Stream says that the fall in activity within the residential property market can in part be attributed to the 3% rise in stamp duty introduced in April. It says that some buyers and sellers in residential property have been holding back on an intended purchase or sale until a decision on Brexit has been reached.
Liam Brooke, co-founder of Saving Stream, said: “The wider use of alternative finance is a really positive development for the commercial property sector. It shows that commercial property investors are finally getting the funding they need.”
“Alternative finance providers, including peer-to-peer lenders, are playing a big part in this by filling the funding gap left by banks. The latest figures pay tribute to this.”
“There is no shortage of demand for commercial property developments here in the UK but developers have struggled to access the funding they need to see projects through, until now.”
“Alternative finance providers, such as peer-to-peer lenders are playing an increasingly important role in the UK economy. They help investors make higher returns, whilst funding sectors – including commercial property – that find it harder to access the financing they need.”
“The role of alternative finance providers in funding both the residential and commercial property sectors is undoubtedly growing. This is an exciting prospect for investors.”