Seize the owner occupier opportunity

If you’re looking at ways SMEs can move into ownership, the experts at InterBay are well-placed to deal with complexity.

We’re committed to supporting SMEs with their expansion and we know every business is different, that’s why we look at each loan on its own merits when reviewing cases.

Explore new opportunities with InterBay.

We can provide commercial expertise
Brokers and their clients will receive a market-leading service
We’re focused on finding funding solutions

The owner occupier sector is going from strength to strength.

According to latest data from CoStar¹, in Q1 2025, the total volume of commercial property acquired for owner occupation in the UK was £2.8bn, a significant portion of the overall £8.9bn invested in UK commercial real estate.

On 23 June 23, 2025, the UK Government published its 10-year Modern Industrial Strategy aiming to boost business investment and growth in key high-growth potential areas such as advanced manufacturing, digital and technology.

If this is to be successful, then SMEs within owner occupied industrial/warehouses and offices may need to be the driving force behind it. June 2025 also heralded the Government’s 10-Year UK Infrastructure Strategy. With £1.35bn of public funding now available, businesses are gaining confidence; industrial occupational demand improved by 10% during Q2 2025, and it’s hoped that this trend will continue.

Market improvements

Office investment also gained momentum in 2025. The sector accounted for the highest share of UK transaction volumes in H1, at 21%, according to CBRE. Industry data from CoStar suggests that UK office take-up has risen to a three-year high and the UK office vacancy rate has stabilised¹, helped by a 10-year low in office construction.

In particular, the UK “Big Nine” regional office cities outside of London (Birmingham, Bristol, Cardiff, Edinburgh, Glasgow, Leeds, Liverpool, Manchester and Newcastle) has seen collective take-up reach 3.7m sq ft², 6% ahead of the 10-year average. Driven by a lack of Grade-A space in city centres, occupiers are increasingly looking out of town. Six of the 10 largest deals in H1 2025 were outside the city centre, compared with 2024 where all top 10 deals took place in city centre locations⁴.

With a limited construction pipeline, this could place upward pressure on rents, enhancing returns and unlocking further investment activity³. Improving retail sales could also be aiding retailer performance with average weekly volumes 2.3% higher during Q2 2025 compared with last year⁴.

Challenges remain

The owner occupier market continues to face several challenges, including economic uncertainties such as inflation and rising interest rates, which impact affordability and borrowing costs.

Additionally, a shortage of available properties, in the face of high demand, makes it difficult for potential buyers to find suitable properties. Navigating changing occupier needs, such as hybrid working patterns and the need for sustainable spaces, adds another layer of complexity.

InterBay’s impact

We're well-placed to help brokers and their clients navigate such intricacies. We support a variety of asset classes, from florists to children’s nurseries, distribution warehouses and small retail units. When it comes to SMEs, we know the market, have clear criteria and our team of experts work closely with brokers to help borrowers secure the funding they need.

For instance, when reviewing cases, we:

use the last two years’ finalised accounts so we see three years’ worth of figures;
look at the performance of the business the experience of the owners, and the specifics of the property; and
aim to meet with the borrowers directly for loans over £4m, so that we can fully understand their background and plans.

We also may look at securing on another property to help get the borrowing level required or mitigate risk in other ways. This includes requesting capital and interest payments to help bring the risk down over the term or including other assets of the business in debentures. When reviewing accounts, we look at EBITDA (earnings before interest, taxes, depreciation, and amortization) where necessary. This means that on occasion, despite a company reporting a loss, our affordability requirements may still be met.

In addition, we take exceptional items into consideration, such as legal costs, repairs, research and development. Every business and property is different so we look at each loan on its merits and balance out risks (where possible) to solve clients’ complex cases.

Have you got a client focused on opportunities in the industrial sector? Do they have a warehouse, logistics, storage, distribution or manufacturing business they want to grow? Talk to our team and see how we could help.

Scenario Warehouse and distribution, we've got you covered:

Client wants to purchase a larger warehouse with distribution capability
Funding on a 20-year interest-only basis for a commercial owner occupier
Request for 70% LTV, which includes fees
Building has an EPC of B so looking at reduced rate products based on ESG credentials
Gross loan of £1.45m required

Do you have a client that's outgrown their current premises and looking to a expand their business? Whether it's a betting shop that's on a winning streak, a tattoo studio that wants to make their mark, or a nail salon that's doubled their client base – InterBay could find a solution.

Scenario We don't cobble deals together, we craft them:

£225k commercial owner occupier loan required for a shoe repair shop to expand
75% LTV gross on a 10-year interest-only term
Clients looking for an initial 2-year fixed deal
Property is a converted Victorian building with an EPC of D, with a chance for improvements

Contact us

At InterBay, we pride ourselves on offering personal service to all our intermediaries. When it comes to placing a case with us, we want to make things as straightforward and easy as possible. Our website includes all the information needed to get started. Simply visit our new submission page and follow our quick, five-step plan on how to submit your cases to us.

If you'd like to discuss a case or you're looking for more information please get in touch, and a member of our team will be happy to help.

FOR INTERMEDIARIES ONLY

The products and/or services featured in this communication are not regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

InterBay Commercial, is a trading name of InterBay Funding Limited, which is a subsidiary of OneSavings Bank plc. Registered office: OneSavings Bank plc, OneSavings Bank plc, Sun Pier, Medway Street, Chatham, Kent, ME4 4ET, United Kingdom. OneSavings Bank plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (registered number 530504). We subscribe to the Financial Services Compensation Scheme and the Financial Ombudsman Service.
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Seize the owner occupier opportunity