Balmoral Capital has its sights set on expansion and continued growth this year.
The capital advisory firm, which specializes in structuring financing solutions, has grown rapidly since its founding in 2022.
Managing partners Dustin Greiver and Darren Weltman have advised on over $1bn of transactions since the inception of the firm, actively financing deals primarily across Ontario and eastern Canada.
Green Street News sat down with Greiver and Weltman to discuss their business strategy and trends they’re watching this year.
What are your main objectives for 2025? Any expansion plans?
Dustin Greiver: Looking to 2025, our main objective is to solidify Balmoral’s position as a leader in debt advisory, and continue to carry on our national expansion. We aim to grow our team strategically and thoughtfully in order to enhance the level of service to our clients.
Darren Weltman: We’re active across Canada, but we want to grow that footprint nationally. We’re constantly valuing ourselves critically, always looking for ways to improve the quality of our services for our clients and our lending partners.
As we continue to grow our business and expand our footprint across Canada, we want to ensure that we maintain that unwavering commitment to upholding the high standards that Balmoral is known for today.
Looking longer term, do you plan to expand into equity markets?
Weltman: We see ourselves expanding into equity markets to transform Balmoral into a fully integrated capital solution by the structuring and arranging of the full capital stack, from debt to equity, to become a one-stop shop that empowers the market with the most comprehensive financing solutions.
“Looking to 2025, our main objective is to solidify Balmoral’s position as a leader in debt advisory, and continue to carry on our national expansion”
Dustin Greiver
Greiver: Longer term, we do have ambitions of becoming a direct source of capital in both debt and equity. That is further down the line. Our goal is not only to advise on transactions, but to actively participate in them.
On what trends are you looking to capitalise in the coming year?
Weltman: One of the key trends we’re closely watching is the rising prominence of purpose-built rental developments. Historically, most of our clients were focused on for-sale condo projects. However, in today’s environment, we’re seeing a significant shift, as these developers are starting to evaluate their projects as rentals instead.
Greiver: At the same time, the economics of rental developments have started to become more compelling. Incentives, like the HST rebate and recent discussions at the municipal and provincial levels about waiving development charges and potentially offering property tax rebates, continue to help.
Obviously, CMHC financing has become a huge focus for our business and for developers. It’s oftentimes the most favourable in terms of leverage and pricing for their construction financing. It’s a trend we see continuing, and at Balmoral we’re constantly ensuring that our team and our clients are constantly apprised of any changes to CMHC policies.
Can you talk about your approach to dealmaking?
Weltman: We approach every deal with transparency, meticulous preparation and commitment to delivering maximum value. Before any formal engagement, we dedicate a ton of time to underwriting and strategizing financing structures, ensuring that by the time a client actually engages us, they have a clear understanding of the lenders we plan to approach and the parameters that we’re targeting for the eventual financing structure, often with multiple tailored structures in mind.
Greiver: Once we’re mandated, we prepare a comprehensive and uniquely tailored confidential information memorandum (CIM) package for each of the lenders that we target on a given deal. And in that CIM, we capture each lender’s specific underwriting criteria and preferences, and we engage directly with each lender that we’re targeting, and we walk them through the underwriting in detail and highlight all of the main points of the deal.
Weltman: Our goal in the transaction is to create a high degree of competitive tension amongst the lenders at the table, presenting our clients with multiple options and varying degrees of pricing terms – flexibility that [will allow] each [to] have their own competitive merits for the file. And from there, we work closely with our clients to strategize the best path forward, ensuring the selected structure aligns with their short- and long-term goals.
“One of the key trends we’re closely watching is the rising prominence of purpose-built rental developments”
Darren Weltman
How and why do you incorporate feasibility analyses into your deals?
Weltman: Our goal is to be viewed as an extension of our client’s teams, occupying another seat at the table, at the time in which financing structures are being contemplated on a given project or a new acquisition opportunity.
Greiver: We achieve that in various ways, for example, with the rising prominence of purpose-built rental developments in part due to the low sales velocity we’re seeing in preconstruction condos. We’ve been conducting rental feasibility analyses for several of our clients – many of whom are historically for-sale builders.
Weltman: Our team essentially is putting together pro formas by looking at comparable properties to justify rental rates, leveraging our experience to provide insights on expense assumptions and utilising our expertise in CMHC financing to opine on the capital stack and high-level return metrics.
How has financial advisory changed in Canada over the years, and how does that affect your business?
Greiver: It’s definitely changing. We’ve noticed that, historically, there has been a preconceived notion that you don’t need to work with a dedicated advisor to get the best financing. I think in a tougher debt environment, the days of a one-size-fits-all financing or getting a deal done with a friend at the bank are over. I think the market has become too complex and competitive that the incumbents are recognising the value of working with a firm that is dedicated to structuring financing as imperative on their deals.
The role of a sophisticated debt advisor has moved from optional to indispensable in today’s market, the same way that a vendor would engage a broker to ensure the best results on a disposition. Developers and investors are recognising that they should be taking the same approach on the financing, by working with a firm whose sole focus is to build relationships with the active sources of capital and structure financing transactions.
