Skip Ribbon Commands
Skip to main content

News release

Toronto

Commercial Mortgage Lending Pendulum Swinging in the Borrower’s Favour

JLL’s Debt Capital Markets report sets the stage for what's to come for commercial property financing


TORONTO, July 29, 2014 – Interest rates are anticipated to increase in the near future as inflation continues to edge up and unemployment levels decrease, according to a report by JLL. Lower unemployment translates to increased consumer spending and the ability for landlords to raise rents.

"We track more than 100 sources of debt capital available to Canadians, and there are strong indications that lending is on an upswing", said Amar Nijjar, Vice President and Practice Lead for JLL Canada's Debt Capital Markets team. "Nearly all of the lenders that we track are expressing an interest to lend at the same or higher levels from than last year. There is also an emergence of non-traditional sources that provide creative financing solutions, filling a void that previously existed in the marketplace."

The firm's Canadian Debt Capital Markets team has just released its Commercial Property Financing Renaissance paper, which comprehensively lays out the effects of the changing economy on the Canadian capital lending market.

The report highlights numerous factors that have contributed to the changing lending atmosphere. Among other factors, Canadian Mortgage Backed Securities are on the rise – lenders originated approximately $1.5 billion in 2013 relative to $500 million in 2012. The market anticipates that these lenders will surpass $2 billion in 2014.

Additionally, the report highlights that the debt markets today are much more diverse compared to last few years. "We are consistently seeing lesser known non-traditional type lenders being more competitive than traditional banks and lifeco's", said Nijjar. "There are multiple bids on any mandate that JLL works on and often times there is a huge variance in spreads, loan amounts, structure, amortization etc…commercial mortgage debt is no longer a commodity".

JLL is Canada's fastest growing commercial real estate firm. JLL has two offices in Toronto, with the headquarters located downtown. The firm also operates in, Mississauga, Montreal, Ottawa, Vancouver, Calgary and Edmonton. JLL manages over 50 million square feet of facilities across Canada. The firm offers tenant and landlord representation, project and development services, investment sales, advisory and appraisal services, debt capital markets, and integrated facilities management services to owners and tenants in Canada. 

About JLL
JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual fee revenue of US$4 billion, JLL has more than 200 corporate offices and operates in 75 countries worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3 billion square feet and completed US$99 billion in sales, acquisitions and finance transactions in 2013. Its investment management business, LaSalle Investment Management, has US$48.0 billion of real estate assets under management. JLL is the brand name of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.