The lender said that the funding will allow it to target smaller commercial investment loans worth up to £25m with two-to-five year terms. Octopus said this is an area that is currently under-served by lenders, but where its debt platform is already established.
PwC acted as lead adviser to Octopus on the funding agreement with Bayview, which is an investment management firm which focuses on mortgage and consumer credit.
Benjamin Davis, CEO of Octopus Real Estate, said the partnership highlights the opportunities offered to local and institutional investors by the UK property market.
He continued: “With specialist expertise across the residential, commercial and development sectors, Octopus is uniquely positioned to deliver upon the demand from institutional investors for high-quality, diverse real estate assets that meet a range of investment criteria.”
Zhu Gong, head of European structured credit at Bayview, added: “At Bayview, we continue to search for and grow strategic partnerships that offer innovative funding solutions in often under-served markets. We welcome this opportunity to work with Octopus, whose expertise will help us gain exposure to high-quality UK small-balance commercial real estate loans.”
Octopus last year formed a ‘Green Alliance’ with Homes England, which saw it commit to lend £175m of discounted loans to developers building energy efficient properties, while it also announced a move into lending in Ireland.