German banks have emerged as virtually the only lenders willing to spend significant amounts of money regularly on large new deals in UK commercial property.
Savills will say today that eight of the 12 lenders willing to consistently back deals of more than £25m to new borrowers in the UK market this year are German.
Only two are UK lenders and one of those, Abbey, is backed by Santander of Spain. This is a marked change from this time last year, when lending was dominated by HBOS and Royal Bank of Scotland, as well as Irish banks such as Anglo Irish.
Their enthusiasm to lend on commercial property has proven to be one of the main reasons for recent difficulties, given the amount of loans in default of covenants owing to the real estate crash. Savills says that the large US investment banks, which had been another major source of money, have also left the market.
Savills interviewed more than 100 global lenders, of which more than 40 claimed to have an appetite to lend to UK property.