The value of commercial property loans in breach of their agreed terms has more than trebled in six months and now stands at just under £7bn, according to a report by DeMontfort University.

The number of property investors slipping into breach of their contracts and defaulting on their loans is a genuine concern to the banking industry, and to the UK economy.

The number of organisations who have loans in breach of financial covenant has almost doubled to 78% of all companies, compared with fewer than 50% at the end of last year.

Research by DeMontfort also revealed that the commercial property sector has almost £209bn worth of debt and that around £600m worth of loans were defaulted during the first six months of the year.