From Blackstone to M&G – who is funding the next wave of UK properties?

This is a financial promotion and is intended to provide information, not investment advice.

The UK property market is undergoing a transformation, driven not by individual landlords, but by global institutional investors. Giants like Blackstone and M&G are deploying billions into everything from logistics hubs to rental housing, reshaping how homes and commercial spaces are funded and developed.

Last year, institutional investors such as private equity firms and pension funds spent a record £1.5bn on single-family homes . Blackstone claims to have been the largest provider of newly builds in the UK for the last three years, having built more than 17,000 affordable houses so far.

Despite years of government promises to build more social housing, the current property building boom is being fuelled by private investors who have seen an opportunity to plug a gap in the market and earn competitive returns in the process.

But what does this surge of capital mean for the average UK investor? And can retail investors still find value in a market increasingly dominated by private equity and asset managers?

Institutional interest

Institutional investors are attracted to  UK property due to its attractive valuations, stable rental yields, and long-term income potential amid market volatility.

In a recent report, M&G’s global head of real estate Martin Towns said that real estate “can provide real cash flows and diversification benefits in an inflationary environment” . He added that UK real estate currently presents “a rare chance to acquire assets at an attractive entry point.”

These institutional investors are aware of the rising rental demand in the UK, and the worsening housing affordability crisis. They are now shifting their focus towards single-family homes instead of multi-family developments, as these properties attract stable, long-term tenants and are simpler to build under the UK’s restrictive planning regulations.

The depth of capital from Blackstone and M&G can be viewed as a good sign for the UK property sector. Clearly there is value there, and long-term growth potential. But is the dominance of these institutions keeping retail investors from benefitting from a future property boom?

Retail opportunity

The government is changing the property rental market, with upcoming reforms expected to make it harder for buy-to-let investors to maximise their returns.

But there are still a few ways that retail investors can follow in the footsteps of Blackstone and M&G and take advantage of the current opportunities in UK real estate.

Firstly, it is possible to invest in these institutions directly by buying stocks and shares in their listed businesses. However, it is important to understand that by investing in Blackstone stock, for instance, you are investing across the company’s entire portfolio, not just its UK property holdings. All stocks and shares holdings are also vulnerable to market volatility, which can be caused by macro-economic events as well as sector-specific stressors.

Retail investors can also invest indirectly in the UK property market through dedicated real estate investment trusts (REITs), private funds, or long-term asset funds (LTAFs), but remember that these come with management fees and liquidity thresholds which may not make them suitable for all investors.

easyMoney’s solution

UK retail investors can also access property-backed loans via the easyMoney platform, which deliver returns akin to BTL yields. easyMoney is currently targeting between 5.4 and 10 per cent per annum, subject to terms and conditions, with interest paid monthly. More than £50m has already been paid out to investors in interest alone, with zero capital losses to date.

Blackstone’s property investments show that there is money to be made in UK real estate at the moment, but retail investors have to think outside the box a little if they want to emulate the success of the institutions.

Small, indirect property investments can boost housebuilding activity in the UK, just as Blackstone’s property holdings have led to more affordable properties being built. Property lending platforms such as easyMoney can also offer a route for retail investors to fund property creation, while earning risk-managed returns diversified across a regulated peer-to-peer lending platform.

Blackstone and M&G may be funding the next wave of UK properties, but you can join them, just as long as you do your due diligence and choose the right investment partner.

Capital is at risk. Past performance is no guarantee for future results.

Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future.