In a move to net a slice of the $10 billion commercial property market, specialist lender Bluestone Group has launched a new business funded by Barclays Bank.
The new business, Bluestone Commercial, is aimed at self-employed borrowers and professional investors. It is the group’s third business unit in Australia and New Zealand and joins Bluestone Mortgages and Bluestone Equity Release.
Group chief executive officer Alistair Jeffery said Bluestone Commercial is being launched after extensive offshore research and a review of the needs of small owner-managed businesses, self-employed sole traders and professional investors who own commercial property.
“Bluestone has progressively broadened its products into segments where we see a strong demand, yet existing financial services providers are failing to meet borrowers’ expectations or needs,” Jeffery said. “Commercial property is seen as an increasingly attractive asset to own due to its higher yield, strong capital growth and potential to own and operate a business from it.
“Our research suggests that the self-employed commercial sector is poorly served by traditional lenders. Gearing levels are generally low, loan terms short, prior credit problems are seldom tolerated and the credit assessment often involves a review of the business operations and regular reviews,” he said.
Jeffery said this approach has undoubtedly led to bank customers feeling disillusioned as they struggle to meet the rigid requirements.
“Borrowers will be able to self-certify their income and borrow from Bluestone to purchase or refinance commercial security such as industrial, warehouse, retail shops and small offices. Loan proceeds can be used for consolidating existing loans or raising expansion or investment capital, with loans of up to $5 million per security, and $10 million per borrower.
Bluestone Commercial will finance varying types of property including small business premises from small strata offices, light industrial and retail shopfronts and mixed use residential. Although highly specialised security types will not be included.
Bluestone Group was established in 2000 to provide specialist home loan products. The business is backed by a number of large financial services groups including Dutch bank, ABN AMRO, UK-based fund manager Cambridge Place Investment Management, Barclays Bank and senior management. To date, Bluestone has provided more than $4 billion in home loans to over 20,000 Australians and New Zealanders.
