UK property lender Octopus launches in Ireland

Specialist property lender Octopus has launched in Ireland and aims to lend up to £300 million (€355 million) a year into the sector when fully operational.

Developers and homebuilders are increasingly reliant on non-bank lenders to finance their operations,with traditional banks either shunning construction altogether or lending only on strict terms.

Non-bank lending represents about 25 per cent of all property lending in the UK and accounts for a greater share of smaller loans – those up to £10 million.

Octopus said it offers clients a speedy approvals process on bridging loans starting from €500,000.

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The British outfit said its product is available for all types of commercial property transactions, including the acquisition of land with planning for residential.

Maximum loan-to-value is set at 70 per cent and rates begin at 0.75 per cent per month over terms of one to 24 months, it said.

Octopus says it has transacted more than 3,800 loans worth £5 billion in the UK since its inception 15 years ago.

Similarities

James Nunn, who is leading the Irish launch, said the company was lending approximately £300 million (€355 million) a year in the UK and that it hopes – in time – to replicate that level of financing here.

The aim initially is to focus on the State's five main cities – Dublin, Cork, Waterford, Limerick and Galway.

He said the Irish market had similar characteristics to the UK in terms of “similar planning laws, legal policies and a liquid market”.

“We are known for our speed of execution, transparency and flexibility, and we want to introduce our service to a vibrant and growing new marketplace,” Mr Nunn said, noting Octopus’s average inception to completion time is three to four weeks. Traditional banks can take four to six months to transact a similar arrangement.

Benjamin Davis, the chief executive of Octopus Real Estate, added: "Ireland is an important market for us, and our product launch offers Irish clients a trusted finance solution, backed by over 15 years' experience in non-bank lending.

“The Irish commercial property market is thriving, and the launch of our commercial lending product will enable the funding of developments of scale across the commercial spectrum,” he said.