‘Larger and more sophisticated' deals create new opportunities for specialist lenders

Demand remains strong for funding that sits outside traditional product and policy frameworks, particularly as borrowers seek solutions for portfolio acquisitions, mixed-use assets, refurbishment opportunities and specialist commercial transactions.

Without fixed product or policy criteria, our focus at OSB has been on building relationships with brokers and creating awareness around what we can do.

Brokers often recognise when a deal should be viable but find themselves constrained by traditional lending parameters. Our role is to bridge that gap, taking a more flexible view while maintaining a structured approach to risk and delivery.

Larger transactions fuelling growth

The team has seen strong levels of demand from brokers seeking support on larger and more sophisticated transactions. Both enquiry levels and conversion rates have been encouraging, reflecting growing confidence in specialist property lending solutions.

Last year, we averaged around £10m per completion, with individual loans ranging from £5m to £45m. The cases we’re seeing are broadly what we anticipated, including complex ownership structures, multi-asset portfolios and assets where there is a clear opportunity to create additional value.

With no upper limit on loan size, we’re also seeing larger and more sophisticated opportunities coming through, often involving investors with more efficient ownership structures.

That evolution is also being reflected in broker behaviour. Advisers are becoming more confident in identifying cases that may benefit from a bespoke lending approach and are increasingly engaging specialist lenders earlier in the process.

The brokers we work with generally have an excellent understanding of both their clients and the market. The quality of information we receive is often very high, which allows us to focus quickly on the areas that matter most from a decisioning perspective.

As relationships develop, brokers also become more familiar with how we assess cases, helping to streamline the process further.

The value of early engagement

The most successful transactions almost always involve discussions at an early stage. Structuring a deal that works for all parties takes time, and it's much harder to retain flexibility once a transaction becomes constrained by deadlines.

The earlier we’re involved, the greater the opportunity to shape structure, pricing and terms in a way that supports the client’s objectives.

Opportunities across specialist sectors

In terms of asset classes, mixed-use properties and PBSA continue to feature prominently, alongside a broad range of multi-occupied assets.

We’ve maintained a strong appetite for both sectors. One of our strengths is the expertise available through our real estate team, which provides detailed insight into local market dynamics, particularly within the student sector, alongside cashflow and sensitivity analysis.

The combination of specialist lending expertise and real estate analytics helps us assess opportunities that may require a deeper level of understanding than more straightforward transactions.

Refurbishment projects also remain a significant area of activity, particularly where borrowers are looking to improve asset performance or unlock additional value.

We’ve supported a number of refurbishment projects that have delivered meaningful value uplift, reflecting continued investor interest in assets where there is an opportunity to reposition or future-proof income streams.

Balancing technology and human judgement

While technology and platform transformation continue to enhance lending journeys across the group, specialist property finance continues to rely on a combination of digital capability, experienced judgement and strong broker relationships.

Technology has an important role to play and can enhance analysis, stress testing and decision support. However, complex lending still relies heavily on experienced judgement.

Automation works well for cases that sit within clearly defined parameters. Specialist transactions often require a much more detailed assessment of the borrower, the asset and the wider commercial context.

OSB Group’s new lending platform, which is part of a larger five-year transformation investment, has strengthened the wider ecosystem by improving segmentation and ensuring cases are directed to the right teams. Larger portfolio transactions and commercial-scale opportunities continue to benefit from a more tailored assessment process.

What comes next for specialist property lending

Specialist property lending also forms an important part of OSB Group’s broader diversification strategy. Structured commercial lending, bridging and portfolio finance are areas where bespoke underwriting can deliver value for both clients and the lender.

We’ve seen diversification become more important and specialist lending plays a clear role within that. We’ve also contributed to a number of proposition developments across the wider business, helping ensure market opportunities are supported by appropriate policy and pricing structures.

Looking ahead, I expect refinancing activity to remain a key theme across specialist property finance.

Refinancing activity remains strong, with many borrowers continuing to assess funding options as pricing and market conditions evolve.

If that stability doesn’t emerge as quickly as some anticipate, we may see greater pressure on gearing and serviceability, leading to more opportunistic transactions. We’re already seeing examples in parts of the market where investors and developers are looking to recycle capital or exit positions.

For lenders with the expertise to assess complex opportunities and structure solutions around them, the market continues to present significant opportunities.