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A non-major bank has announced a new variable rate for commercial loans in response to growing investor demand for commercial property.
On Friday ING Direct introduced a new variable rate of 4.50 per cent for commercial loans of $2 million or more.
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John Kolyvas, national partnership manager, commercial, at ING Direct said that as investment in residential property “loses a little of its lustre”, commercial property is looking increasingly appealing for its relatively stable growth and solid returns.
“Commercial lending has been growing steadily in the past few years and in the current environment this is expected to continue,” Mr Kolyvas said.
“This new tier and variable rate is in response to an increasing demand for commercial loans above $2 million.”
The new tier will apply to eligible applications unconditionally approved from 6 October 2015.
Mark Woolnough, ING Direct's head of third-party distribution, said the growing investor appetite for commercial property was a great opportunity for brokers looking to build a sustainable and diversified business.
“With investors increasingly turning to commercial property there will likely be a complementary surge in demand for professional support to help navigate the market and negotiate on commercial loans,” Mr Woolnough said.
“There is huge scope for brokers to meet this demand – they have relationships with lenders, access to market insights and are knowledgeable about the nuances of commercial loans.”
[Related: Investor demand turns to commercial property]
