Landlord purchase activity may be more subdued than usual this year, but that doesn’t mean lending activity has stalled. In fact, refinancing has become the primary focus of many commercial landlords and brokers, as fixed terms expire and landlords look to reshape their portfolios.
A report from Bayes Business School projects that around £32.6 billion worth of commercial real estate loans are due to mature in 2025, providing a significant opportunity for brokers to support landlords through a strategic refinance for their portfolios.
The report also showed the wider lending market is showing signs of renewed momentum and new lending for commercial real estate increased by 11 percent in 2024 compared to the previous year, largely driven by refinancing. Activity picked up particularly in the final quarter, aided by two Bank of England base rate cuts boosting confidence across the sector.
Sentiment among landlords is also shifting. Re-Leased’s Landlord Commercial Real Estate Sentiment Report reveals that maximising revenue growth is now the top priority for over a third of landlords. This is being driven by increased rental values, strategic renovations, and asset repositioning.
Portfolio expansion is the second most common focus, followed by operational efficiency improvements such as cutting costs, embracing digital solutions, and enhancing energy performance. Although interest rates, regulation and operating costs remain key challenges, the data suggests that many landlords are now choosing to adapt rather than retreat.
Creating a blend of efficiencies
Refinancing is playing a vital role in that adaptation. Landlords are increasingly using it as a way to release equity for acquisitions, restructure debt, or fund property improvements. In many cases, landlords are taking a step back to look at their entire portfolio, rather than tackling finance on a property-by-property basis. Some are consolidating numerous single-asset loans into a smaller number of strategic facilities. This approach can help cut administrative costs, streamline ongoing management and provide greater flexibility for future sales or investments.
Others are separating assets into distinct groups based on future plans. For example, a landlord might group core, long-term hold properties into one loan, while separating less strategic or potentially disposable assets into separate facilities. This allows them to maintain flexibility to divest certain assets without affecting the rest of their finance arrangement.
In this sense, refinancing is becoming a vehicle for both financial efficiency and strategic portfolio management.
A fully operational strategy
This portfolio-led approach can deliver real value compared to piecemeal financing, with loans spread across multiple lenders. As business costs rise, including the recent National Insurance increase, many landlords are taking a more forensic view of their operating models. In cases such as mixed-use portfolios or commercial premises like retail units, some tenants or operators have responded by reducing opening hours or scaling back operations to preserve margins. Finance is now firmly part of that wider cost-control conversation.
Brokers have a critical role to play here. Not all refinance deals are straightforward, and not all clients are rate driven. Some landlords are looking beyond price to find lenders who can offer tailored solutions and long-term value. This includes flexibility on early repayment charges, the ability to restructure debt in line with their business plans, and the option to release capital without being locked into rigid loan structures.
Importantly, this kind of consultative refinancing is not a standard product that can be plucked off the shelf. Lenders with a solution-led mindset are working closely with brokers to understand the client’s aspirations, not just their immediate borrowing needs. It’s not uncommon for a landlord to come forward seeking capital for a new project, only for the conversation to evolve into a full portfolio review. When the broker has a close understanding of what the landlord is trying to achieve over the next few years, they can help shape deals that work harder and deliver better long-term outcomes.
For some lenders, this might involve consolidating multiple loans, reducing frictional costs, and giving the landlord the option to exit certain parts of the portfolio down the line. For others, it might mean breaking down a large portfolio into a few flexible loans structured around different asset types or risk appetites.
The big picture
But the key message for brokers is to dig deeper and understand the strategy behind the deal. It’s that insight that enables lenders to be flexible and deliver value where it matters.
This year is also set to be a record year for remortgaging in the residential space, with both two-year and five-year products taken out during the post-pandemic surge now reaching maturity. UK Finance expects buy-to-let remortgage lending to increase further, and brokers are already seeing this play out. The cross-sector message is clear that refinancing is not just about replacing an expiring deal. For many landlords, it is the catalyst for reshaping their portfolios, consolidating costs, and positioning for future growth.
In 2025, refinancing is not just a trend, it’s part of a careful strategy. And for brokers, it’s the perfect time to lead that conversation.
Conor McDermott is director of SME lending at LHV Bank
