M&G Investments agrees £69.1m loan for London office project

Political uncertainty does not appear to have deterred M&G Investments from London office deals, with the fund manager on Thursday inking a £69.1 million lending agreement.

The firm has agreed the loan to a joint venture between Goldman Sachs and developer Greycoat. The pair will use the money to refurbish and re-let Procession House, one of the bank’s former offices.

The revamp of the 100,000 square feet building at Ludgate Circus will complete in early 2020.

Appetite to lend comes despite jitters in the commercial property market that demand for new offices could fall once Britain leaves the EU.

Dan Riches, a director in M&G’s real estate finance team, said: “The UK, and in particular, London, continues to offer strong relative value and we continue to see a considerable pipeline of opportunities in this space.”

Riches added:“Following an active 2018 during which we committed to over £1.2 billion of investments across Europe, our institutional investors continue to seek exposure to commercial real estate debt in order to achieve attractive risk-adjusted returns.”