Blackstone Real Estate Debt Strategies (BREDS) and Pluto Finance have launched a strategic alliance to promote real estate financing solutions in the United Kingdom and continental Europe. The agreement provides for a €2.36 billion (£2 billion) lending programme to be rolled out over two years.
The strategy will focus on direct loans of between €29 million and €118 million, for both development and investment, with a particular focus on the logistics and residential sectors. The latter includes rental and sale housing, student residences and co-living projects, areas where supply shortages and increased demand are creating attractive opportunities for financiers.
The launch coincides with the growing role of private financing in the European real estate market. With nearly €1 trillion in outstanding commercial real estate debt and more than €310 billion in new annual origination, the market is increasingly turning to alternative lenders as traditional banks reduce their exposure. The structural shortage of housing in major European cities, marked by population growth, smaller households and delays in the delivery of new projects, reinforces this trend.
Justin Faiz, CEO of Pluto Finance, said the alliance will expand the company's real estate financing platform in continental Europe, leveraging its expertise in originating and managing mid-sized transactions. Ciaran Singh, Managing Director for Europe at Pluto Finance, highlighted the strong demand for private credit to finance real estate assets and developments in various sectors. According to him, Pluto's local teams bring in-depth knowledge of the target European markets, where the firm plans to expand its activity after having already granted €3.95 billion in more than 300 transactions in the United Kingdom.
David Gorleku, head of BREDS in Europe, noted that Pluto Finance has a proven track record in small and medium-scale real estate financing and that the alliance will enable Blackstone to channel institutional capital into a traditionally underserved market segment, strengthening its lending capacity in the middle market in Europe.
