Borrower Perspectives: Gerald Greenberg, President, Signet Group
"Congratulations to First National Financial on the incredible milestone of 30 years in business. A company does not become the largest non-bank mortgage lender in Canada without doing things properly. We at Signet Group wish you continued growth and success. Special wishes of congratulations to Peter Cook and his team, who have always delivered when called upon."
Gerald shares his perspectives on the evolution of the industry, why he appreciates the simplicity that First National brings to the financing process and what's contributed to First National's longevity.
How have you seen the industry evolve in the past 30 years?
GG: Compliance is certainly one of the biggest shifts. The industry has also become very competitive. A lot of people are buying, and a lot of financial institutions are vying for business. When I started, we were buying properties at eight to 10 per cent cap rates. Since the REITs and insurance companies have gotten into the business, the cost to buy has increased dramatically, making it a bit more challenging for small and mid-sized owners.
When did you start working with First National?
GG: We've been working with First National since our first-ever acquisition in 1996. So that makes it 22 years.
Why did you choose First National at the outset, and what made you keep choosing First National?
GG: Somebody recommended that I call First National when we were making our first acquisition. I connected with Peter Cook for that initial deal. And now, for every acquisition that we undertake, I call Peter and his colleague Evan Pawliuk. They just make it easy for me. The changing regulations have compounded the legal work exponentially and created increasing documentation demands. Even with the regulations and associated requirements, Peter and Evan smooth over any bumps. It's always an attitude of, "Don't worry, we'll take care of it."
How has First National helped you grow your business?
GG: Peter and Evan's ability to simplify financing enables me to acquire without worry. If financing was an impediment, I would think twice about buying. But it's so easy to deal with First National. When I have a potential acquisition, I know I need x dollars down, and the rest I don't have to worry about. I also appreciate being tapped into Peter and Evan's network. They often send me potential opportunities or they know someone who is selling something that may suit my portfolio. They keep their finger on the pulse of what's going on, with my success and growth in mind.
They are also creative and smart, finding innovative ways to extract value from my portfolio. Typically, most people wait until term's end to take advantage of increasing property values and pull out equity to finance other acquisitions. However, on occasion, property values increase in the short term. We have been successful in placing secondary financing, at favourable rates, which is then combined with the initial financing upon expiry.
What do you value about your relationship with First National?
GG: My relationship with Peter and Evan extends beyond real estate. Peter has helped me significantly in building and diversifying my business interests. Two of my sons are in the business with me, and Peter and Evan always make a point of including them in industry functions, learning events and business development opportunities. They are really supporting my sons, helping them to grow the business and gain vital industry knowledge.
Thirty years is a significant milestone. In your opinion, what has contributed to First National's longevity?
GG: First National provides a level of service that is unmatched in the industry. Clients appreciate that. When you feel taken care of, you want to come back for more business. I haven't had much experience with other lenders, mostly because I don't want to deal with the bureaucracy. The process can be complex and rigid.
For example, I had a large financial institution pursuing me for more than a year for an opportunity to finance an acquisition. I finally relented, thinking I may try it out. I shared an acquisition that we were considering, and the financing professional there came back with an astronomical rate. When I questioned him about it, he told me that he responded only out of courtesy and that residential mortgages weren't a strategic priority at that time. So we got a quote, but the organization didn't really want our business. It didn't make sense to me. He'd pursued me for business for more than a year, and when I finally sent him an opportunity, he priced it out of the realm of possibility. It was a good reminder, and I haven't gone anywhere but First National since.