Schroders set to move into property market
SCHRODERS has begun talks to enter property lending as banks cut their exposure to the sector.
The blue-chip money manager is looking at setting up a division to provide debt finance to property owners and developers. It has not made a final decision on the size of the scheme, which could be wrapped into its current property arm.
Schroders would join several other financial sector firms that have entered or grown their presence in the sector while banks remain nervous about backing property projects and hold on to capital in order to meet Basel III rules.
Last month Legal & General agreed to provide student landlord Unite with a £121m debt facility and last year a fund run by Blackstone bought a portfolio of property loans worth £1.4bn from RBS at a 30 per cent discount.
Schroders declined to comment yesterday but William Hill, head of property, previously told the Financial Times: “The withdrawal of the banks from the senior lending market has created a very interesting opportunity for alternative sources of capital to exploit.”