LEPs ‘encourage property finance optimism’, says PwC

MORE than a third of lenders in the Midlands intend to make more finance available for commercial property development thanks in part to the establishment of Local Enterprise Partnerships, according to a poll conducted by PwC.

The results came at a financial property event organised by the advisory firm at its Birmingham offices.

38% of lenders at the event said they were expecting to increase funding for real estate investment in the coming year. Only 19% said they did not expect funding to increase.

A primary reason for the improving outlook for commercial property investment is the recent establishment of the region’s Local Enterprise Partnerships and their early stage success in terms of securing finance for five first-round Regional Growth Fund bids and their thinking on the possible siting of new Enterprise Zones.

87% of lenders at the Midlands event said they thought that the recently-formed LEPs were likely to have a positive impact on the region’s commercial property sector. Most lenders believe that LEPs have an important role to play as both strategic influencers and delivery agents, however, they are not expecting to have any direct dealings with them during the next 12 months.

Alistair Reason, real estate expert at PwC in the Midlands, said: “The outlook for commercial property investment in the Midlands is definitely improving, but it had reached a very low level in recent years, and the prospect of a small but noticeable upturn in activity in the year ahead will be welcome news for developers and investors alike.

“The establishment of the region’s LEPs is helping to instil a sense of confidence among investors and while there is still some uncertainty about how much benefit will be felt by the region’s commercial property market in the short term, things are definitely starting to look up.”