The Voice of Commercial Real Estate Finance

Alternative Lenders

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Alternative Lenders Forum

In the years since the Global Financial Crisis, the role played by non-bank lenders in the UK and certain other European CRE finance markets has increased significantly, as a result of a number of factors. In some respects, the pandemic has had similar effects (despite the very different state of CRE finance markets coming into 2020 compared with 12 years earlier).

  • Many banks narrowed and/or reduced their appetite for CRE exposure, with the result that many real estate investors found it more difficult to secure finance from that traditional source.
  • In the extraordinary monetary and macroeconomic conditions that followed the GFC (and, now, the pandemic), large amounts of fixed income capital has been attracted by the risk/return combination offered not only by real estate, but specifically too by real estate debt.
  • The hostile environment created  post-GFC by European regulators for CMBS, notably for insurers subject to the standard formula for the solvency capital requirement (SCR) under Solvency II, led to many firms setting up their own lending platforms or allocating capital to third party managers - these are very much part of the landscape now.

While there is undoubtedly some fuzziness around the edges of the “alternative lenders” universe, it seems clear that this part of the market is structurally important, adding diversity and resilience from a financial stability perspective, as well as choice and competition for real estate investors and debt investors alike.  At the same time, there may prove to be vulnerabilities arising from the opaque funding structures (including use of leverage) in this part of the market, coupled with the reliance of certain parts of the real estate market on non-bank lenders.

We are keen to support this new sector, which is well represented in our membership, helping it acquire a clearer sense of coherence and identity both internally and for the key external stakeholder groups of borrowers, debt investors and regulators.  We also have an open dialogue on the subject with both INREV and AIMA's Alternative Credit Council, given the overlaps in our respective memberships.

Please contact David ( or Peter ( for more information.