Mera Investment Management has partnered with academics from the London School of Economics (LSE) to look into the impact of private credit in UK real estate.
The research will focus on the rise of non-bank lending, the sectors it is affecting, and changes in underwriting standards.
Mera is working with Professor Olmo Silva and Dr Ignacio Aravena-Gonzalez from the LSE to collect data through a broker survey and feedback from high-net-worth investors.
The study will cover topics such as which property types are most often financed using private credit, loan structures, interest rate expectations, areas of the UK seeing the most activity, and wider influences like inflation and geopolitical risk.
Mera will use desktop research and bespoke data from broker and investor surveys to analyse borrower trends, lending conditions and investor sentiment.
Edward Matthews (pictured), CEO at Mera, said: “Private credit is no longer a niche. Institutional capital is stepping in to fill the gap left by retreating banks—bringing increased liquidity and competition.
“We’re excited to be spearheading this research project, supported by our leading academic and research partner LSE, to better understand the impact of this market shift and to shine a light on the opportunities and challenges presented as a result.
“We look forward to engaging with a range of borrowers and stakeholders on the topic to track year-on-year borrower sentiment regarding non-bank lending and what it means for the future of real estate funding.”
Olmo Silva, professor of real estate economics and finance at the LSE, said: “Private credit is rapidly becoming a dominant force within real estate finance.
“This report will explore the dynamics that have led to its rise in popularity, as well as the unique risks and opportunities it presents for investors, developers, and intermediaries alike.
“We are excited to partner with Mera Investment Management for this first-of-a-kind report and welcome active participation from brokers, whose on-the-ground expertise will be invaluable in helping us to understand the long-term implications of private credit on the sector.”
