Insurance News Archive
Commercial property debt has trebled
Lending to the commercial property sector increased 16 per cent to £156 billion last year, according to latest research.
Figures show that more than £173.6 billion of outstanding debt was recorded at the end of 2005, reports the Journal.
The study from De Montford University shows that commercial property debt has more than trebled since 1999.
In 1999, there was more than £50 billion lent compared with £156 billion last year and it is thought that borrowers are taking advantage of low interest rates and a boom in property prices.
Research also shows that funding for speculative development and loan-to-value ratios are also on the up.
Statistics show that UK banks accounted for 45 per cent of the money lent to property domestically and German and North American lenders also increased their prominence.
New lenders contributed to over £62 billion of debt in 2005, which is a 47 per cent increase and the largest since the research was first published.
01 Jun 2006