Blackstone has secured a huge new loan to build out the development pipeline of St. Modwen, which it took private in 2021.

RBC Capital Markets has arranged a £525M loan to fund St. Modwen’s development, which will turn into an investment loan once the assets are built up and leased. When the pipeline is built out, it will comprise 5M SF of small, medium and large industrial units across the UK.

RBC is one of the lenders providing the debt, as is Otera Capital, the real estate lending subsidiary of the Caisse de dépôt et placement du Québec. It is Otera’s first deal in the UK.

RBC was also one of the lenders that provided Blackstone with a £1.15B debt facility used to take St. Modwen private in a £1.3B deal in 2021.

The private equity firm is in the process of selling St. Modwen’s housebuilding business for more than £300M, React News reported.

The new loan is one of the largest to be underwritten in the UK so far this year, as lenders remain cautious in a world of rising interest rates and falling values. New lending fell 22% in the first half of the year to £18.6B, data from the Bayes Business School’s Commercial Real Estate Lending report showed.