The latest news in investment offerings, financial products and other services relevant to wealth advisors and their clients.

Blackstone, Pluto Finance
New York-based Blackstone Real Estate Debt Strategies (BREDS) and Pluto Finance, a London-headquartered specialist development and bridge lender, have announced a £2 billion ($2.67 billion) partnership to provide financing solutions to real estate owners and developers across the UK and continental Europe.

The partnership will focus on whole loan lending ranging between £25 million to £100 million in size with an initial target deployment of £2 billion over two years. It will combine BREDS’ scale and real estate expertise with Pluto’s borrower network and existing origination and structuring capabilities in the mid-market lending space. 

The strategy will focus on both development and investment loans and will primarily target opportunities in logistics and living sectors such as rental and for-sale housing, purpose-built student accommodation and co-living in the UK and across core markets in continental Europe.

This strategy has been launched amid rising demand for private credit solutions across Europe, the firms said in a statement. With about €1 trillion ($1.17 trillion) of commercial real estate debt outstanding and €310 billion in annual origination, the European market is increasingly turning to alternative lenders as banks continue to reduce their exposure to real estate debt. In addition, an undersupply of housing across major cities, driven by population growth, shrinking household sizes, and a persistent shortfall of new builds has created lending opportunities in the living sectors. 

“The combination of Pluto’s specialist expertise paired with BREDS’ scale and resources, positions us strongly to bring highly flexible, institutional-grade private credit solutions to real estate owners and developers,” Justin Faiz, CEO of Pluto Finance, said.

"We are seeing significant demand from borrowers across Europe for private credit funding to support investment in mid-market property assets and developments across multiple sectors,” Ciaran Singh, managing director Europe, at Pluto Finance added. “Our in-country teams have deep knowledge of our core continental European target markets, and we look forward to building on our strong track record in the UK, where Pluto has lent nearly £3.4 billion across more than 300 transactions."

“As a platform, we continue to broaden our investment approach, and we view this as an attractive opportunity to expand our lending capabilities into the mid-market segment where we see compelling relative value,” David Gorleku, head of BREDS Europe, Blackstone, added.