Investment banks extended loans totalling more than £1.5B to two London schemes this week despite continued turmoil in UK financial markets.

Bank of America provided a £1.25B loan to the owners of 22 Bishopsgate in the City of London, CoStar reported. Meanwhile, JP Morgan provided £277M to fund the construction of the next phase of Quintain’s Wembley Park build-to-rent scheme.

The financings come the same week the value of the pound tumbled on the back of tax cuts and increased government borrowing was announced by the government of new UK Prime Minister Liz Truss.

On Wednesday, the Bank of England was forced to step in and start buying UK government bonds due to the risk credit in the UK financial system might start to dry up.

Bank of America provided a £1.25B loan to the consortium that owns the 1.4M SF 22 Bishopsgate, which includes AXA IM - Real Assets, Singapore’s Temasek and Canada’s PSP.

The debt is at a loan-to-value ratio of 50%, CoStar said, which would value the building at about £2.5B. That would make it the most valuable single building in the UK.

22 Bishopsgate is mainly office space, but also has about 140K SF of amenities, including a gym, health centre, restaurant and food court. The viewing gallery at the top was bought back by Khalid Affara, the investor from whom AXA purchased the site earlier this year.

The building was 75% leased as of February this year, with Apple the largest tenant in 130K SF of space. CoStar said rents at the building ranged from £71 per SF to £88 per SF.

In the second major financing, JP Morgan lent Quintain £277M to build 769 new homes at its Wembley Park build-to-rent scheme in north London.

Quintain said 74% of the homes delivered will be BTR. The balance will be made up of shared ownership, affordable rent and discount market-rent homes, with the residential buildings expected to be completed by early 2025.

Demolition and enabling works on the site began in January 2022. This week, Quintain also signed a £227M fixed-price construction contract with John Sisk & Son to complete the build.

JP Morgan co-Head of EMEA and APAC Real Estate Finance Rahul Sule said the loan had been completed this week “against a backdrop of heightened market volatility and inflationary trends”.

Quintain has already built 3,624 homes at Wembley Park at a cost of £2.5B. Those homes are 99.5% leased, the company said.

The company has seen 1,698 move-ins to its BTR homes this year to date, a 59% growth on the same period last year. There have been 1,680 net reservations, a 44% increase on the same period last year, and the conversion rate from viewings to reservations has grown to 57%, marking a 15% increase.

Average lease lengths continue to be approximately 16.5 months.