Michel Durand says he's been using relationships, trust, and education to drive success in uncertain times
Despite bleak headlines and dire, COVID-coloured predictions for the commercial lending industry, one commercial broker says his firm is having a banner year.
Michel Durand, CEO of Mortgage Alliance Commercial, says that he’s been able to use his trusted position amongst prospects, clients, and lenders to broker a record number of deals in the wake of the pandemic. He says that current market conditions are shaped more by anxiety than the real impacts of the pandemic.
They’re coming, though, and Durand is ready for them.
“When the real estate market does well, we do well, when the real estate market is in turmoil, we do better,” Durand says, noting that many commercial mortgage holders still need their mortgages renegotiated. Now, with underwriting rules and market outlooks changing, it’s harder for those borrowers to conduct and complete that renegotiation or secure new loans. That’s why so many are turning to Durand, he says, to broker the deals they need completed.
COVID-19 still a disruptor
While the volume of business has increased for Durand, he says the work is becoming more challenging than ever. Much of that is due to the decision by many commercial lenders at the end of March to completely stop their lending programs for commercial transactions, both because of the pandemic’s undermining of whole swathes of the commercial real estate market and because of the sheer number of deferral requests.
With the pipeline narrowing, Durand says he’s relied on the strength of his relationships with lenders who, he says, hold him in high esteem and will chose him and his clients for the limited number of commercial deals they’re still making. He says that in a market defined by confidence, a reputation that can only be built over decades is golden.
From a wider commercial lending perspective, he says the Canada Emergency Commercial Rent Assistance (CECRA) program has helped buck up some confidence in the market and “cushion” the impact of the pandemic on the commercial lending space. He says, though, that the ticking clock on a program like CECRA points to a longer-term challenge in the commercial lending space: what will happen when things get worse?
While Durand expects the full impacts of the pandemic to be felt in the commercial lending space in the coming months, he also expects that the mortgage industry as a whole will adapt to a worsening situation. He says that the lending industry tends to react quickly to changing circumstances and that brokers must act accordingly. When things fly out of brokers’ hands, and circumstance sets the tone, he says brokers need to stay on top of their clients. In March, he immediately worked with his clients to ensure their filings and documents were all in their best working order, submitted, and on the lenders’ “front burner”. These clients were the top priority for lenders when they opened the tap again.
Proactivity and education have become watchwords in the commercial space, Durand says. Now he’s addressing mortgage renegotiations due in six months or a year to make sure clients are taken care of before the situation worsens. He’s preparing clients for the eventuality of a weakened economy or second wave of COVID-19 and getting them ready for stingy lending driven by more conservative underwriting rules.
Durand says he’s preparing his business to weather any new storms that may be brewing, putting him in a position to act on every opportunity that arises.
“In every situation like this, and I've been doing this for 27 years, it’s not the end of the world,” Durand says. “We're all going to get through it and opportunities are going to arise. If you focus on that, knowing that you're going to get through it, I’m not saying it's going to be easy, but you're going to get through it and there will be opportunities. All of a sudden, it doesn't hurt so much. All of a sudden, it's easier to handle.”