The campaign promise flying under brokers’ radar?

The campaign promise flying under brokers’ radar?

The campaign promise flying under brokers’ radar? The legalization of marijuana in Canada will open up a new segment for brokers and it’s one that will be ignored by the big banks, according to one major player.

“As far as I know there are a limited number of brokers who have knowledge about lending for that industry and the brokers and lenders will be slow to adapt,” Dale Bilton, one of Canada’s top commercial brokers, told MortgageBrokerNews.ca.

That means those brokers who prepare to fund commercial deals – and learn the ins-and-outs- of what options are out there – will be better situated to cash in on a potential boom as companies prepare to set up growing operations.

Especially considering it’s a segment the banks will likely avoid.

“I don’t think you’ll ever see the banks get into it for political reasons,” Bilton said.

One of Justin Trudeau’s major campaign promises was to legalize marijuana and regulate sales across the country.

Brokers have to look no further than our neighbours to the south, where the pot-boom led to an influx of companies setting up shop in Colorado.

And those companies will require mortgages for their properties.

For his part, Bilton is one of the few brokers in Canada who has experience lending for these types of properties.

“I’ve already done some deals for marijuana grow-ops with legal operations and I usually get attractive rates; it won’t be 3% but it won’t be 8% either,” he said. “There are so few lenders that will lend for these deals.”

Although it may be a difficult segment, it can certainly be lucrative.

“I just did a $17 million one with a second mortgage as well,” Bilton said. “The lender has knowledge of the industry.”
5 Comments
  • Mike 2015-10-23 9:42:50 AM
    It will never happen in Canada so don't get excited about financing farms yet. The subject will be avoided for the next four years and Trudeau will hope voters don't remember. Way to much of a political 'hot potato". I for one do not want to be driving around with a bunch of stoners on the road. Finally got smokers off patios in Ontario, I am sure there is little support from Health Canada, police forces and any one with a brain to legalize drugs.
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  • John Van Driel 2015-10-23 11:08:24 AM
    Totally agree, Mike!!!
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  • Jim 2015-10-23 11:08:52 AM
    Getting marijuana is easy-getting safe marijuana is harder. Stoners are already on the road-they have been for decades, no different than drunk drivers. Legalizing it or not will not make a big difference. Education is the key like anything. Legalize it and keep the bad chemicals off of it and no lacing etc. will make it safer- get it out of the homes and the black market. Also, the federal government has somewhat made it legal already with the thousands upon thousands of medical marijuana permits that they are now trying to negate. Most of the permits were for people who did not need it for medical use but were distributing. We are halfway there already, the Supreme Court has indicated medical marijuana is legal in all forms. Not sure if it is the right thing to do, but if they can still sell cigarettes-one of the most addictive and health harming substances on the planet, marijuana seems to make sense. At least marijuana helps cancer patients etc.-cigarettes do not. Plus, we will get the tax off of it to fund our health care system to treat all the people with marijuana addictions.:)
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