Commercial Mortgages Potentially On The Rise
“Commercial Mortgage Lending In Canada Could Be On The Rise In A Number Of Ways”
Commercial mortgage lending is very much driven by a balanced lender portfolio that takes into account such things as the type of property, industry, and geographic location.
The more diverse the lending portfolio and the higher the quality of the commercial mortgage borrower, the more apt a commercial mortgage lender is going to be to extend more credit.
Right now, there is a trend in Canada whereby more U.S. retail is entering the country to take advantage of the higher dollar and the high per capital spending that exists in Canada which is starting to rival what these retailers are experiencing in the U.S.
Here’s a recent article that provides some further insight from a recently completed report by Colliers Canada …http://www.canequity.com/blog/2011-05-influx-of-american-retailers-leading-to-more-commercial-mortgages/
If the trend mentioned in the report continues and more and more high profile, financially strong retail companies enter the Canadian market and require commercial loans, this will not only increase the commercial lending for the related type of commercial property, but it will likely also help lenders broaden out their portfolios and achieve a larger, stronger portfolio in the process.
This is potentially good news for anyone looking to acquire, renew, or expand their commercial mortgage financing in the future.
Commercial lending as a whole has remained tight since 2007 and has been slow to loosen up as lender remain cautious as to further losses they may have to endure from their existing portfolio.
But nothing loosens up the purse strings more than solid economic growth numbers month after month and credit worthy borrowers looking to acquire capital on properties in major metropolitan areas.
As a commercial lending portfolio grows through lower risk loans, it has the capacity to either cover off existing credit risk in the portfolio or branch out into more commercial markets and take on slightly higher risk opportunities.
It remains to be seen if the U.S. retail expansion in Canada will create a positive commercial property financing domino effect, but it is a strong indication of the market continuing to come around and get back to lending money on a more regular and predictable basis.
From a supply side, the commercial mortgage market has also become stronger from more private lenders entering the market and being interested in commercial properties.
At least in the near term (as nothing is very predictable these days), the commercial mortgage market in Canada appears to be strengthening for deals large and small.
If you require commercial mortgage financing for a property you own or are looking to acquire, I recommend that you give me a call so we can go through your requirements together and discuss different financing options potentially available to your in the market.
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About the Author Joe Walsh
I'm a Toronto Mortgage Broker that arranges mortgage solutions on residential and commercial real estate property. With over 30 years of mortgage financing experience, I'm able to quickly assess your financing requirements and provide relevant solutions for your immediate consideration. Joe Walsh Google+ YouTube Channel