First National Financial LP

Words of wisdom: Russ Syme shares his thoughts on working through the pandemic

  • First National Financial LP

In mid-March, First National’s commercial team retreated to home offices across the country to do their part to stop the spread of COVID-19. Now, more than a month later, we touch base with the members of our origination teams to see how they are coping with the pandemic and what type of work they are doing for clients. These Words of Wisdom come from Russ Syme, Assistant Vice President Commercial Financing at First National in Vancouver. Russ spoke to us from home on April 23, 2020.

How are you making out in dealing with the lockdown?

I’ve very lucky in that working at home is easy. My wife and I have no distractions and no children to care for. I’m pretty self-sufficient with a laptop and cell phone, so nothing lost in a way. Three members of our five-member team work from home on a regular basis as we serve our clients. For them, it’s also pretty close to business as usual. However, two of our analysts have kids at home, which makes it very challenging for them. To their credit, they have adjusted well by taking a flexible approach to their work and family hours wherever it makes sense. I’ve always found First National willing to accommodate different schedules and different ways of working, which is one of the many great features of working here.

What have you been working on? 

We’ve had a fairly high volume of client interactions – both outgoing and incoming calls. We’ve tried to be very proactive in communicating because there has been a lot of anxiety. We provide advice about what options and products we have available and let clients know we are still lending. Clients sometimes tell us they simply appreciate someone to talk to, someone who knows their business, knows their markets and understands the challenges they face. In terms of business, renewal and new loan volumes over the past month have been at fairly typical levels.

There is speculation that there may be permanent societal changes as a result of the pandemic. Are you seeing any changes in the way your clients are thinking about the future?

It’s too early to say but a pre-pandemic trend gaining traction was interest in rental apartments and I think this may continue and possibly accelerate particularly here in Vancouver. Some of our existing clients and a number of new prospective clients are thinking about switching from condo developments to purpose-built rental. The fundamentals driving that switch including low apartment vacancies, land-use policies favouring rental over condo projects to address affordability issues, and the attractiveness of holding apartment assets are not likely to change post pandemic. Pre-selling condos in this environment is also not an enviable task.

Do you encourage clients to look at investing in apartments?

The value of a buy/hold strategy for multifamily rentals is supported by decades of data generally but like anything else, it depends on the property, the neighbourhood and the price one pays. Because we are the leading lender to the apartment property sector, we can share data with our clients and they do look to us to benchmark market conditions and analyze opportunities.

How are apartment assets performing right now?

In April, occupancy rates were strong and the landlords we work with reported good news in collecting rents. Those in the process of leasing up are also reporting great results. That is a generalized comment about the B.C. market and we still have to see how May 1st rent collections pan out but remember this is like a once in a 100-year flood. Apartment properties are a recognized, reliable store of value.

How about conditions in Alberta?

Market conditions are very different. From a lease-up perspective, B.C. and Alberta are like two different worlds. Alberta is challenged right now by the pandemic with the added pressure of low world oil prices. So leasing is taking longer than normal and longer than in B.C. That said, I am confident that apartment properties in cities like Calgary are and will perform better than other commercial property types.

In B.C., are you seeing signs of stabilization? 

I’ll answer that question with an example. Prior to the pandemic, we were talking to a client who was thinking about purchasing land for a construction project. When March came around, he decided to back away. Just last week, he came back and said he felt more comfortable about the situation and wanted to know if we would still finance his project. One client’s views don’t make a trend but it’s certainly encouraging and the fact that the B.C. government did not shut the construction industry plays into the client’s calculus as well.

Are you still lending?

Yes, we are, new loans and renewals. The land purchase I just referred to would be a conventional loan.  

Have you had any wins in this environment?

Absolutely, we have had some really nice wins since March. Just to mention a couple, right at the start of the lockdown, we committed to two conventional term loans and we funded them right in the heart of the pandemic. Our clients were thrilled to get these financings completed and their timing was impeccable given availability issues on the term side of the conventional market.

What about conventional bridge loans?

We’ve done several of these for clients looking for liquidity and/or to take advantage of purchasing opportunities. It takes a certain entrepreneurial spirit to look for opportunities in an environment like this but we have clients who are very smart who have created significant value by taking a contrarian view.

CMHC programs are still available through First National. Are you active in this space as well?

Definitely. I have several clients who are thinking about building affordable rental units and they have asked us to analyze financing options and alternatives. We have substantial expertise in knowing the CMHC program line up, formulating proposals for CMHC and achieving approvals at full ask.   

Has anything surprised you during the pandemic?

I was surprised and impressed with how quickly our clients recognized the challenges they would face and the opportunities that might come along and how quickly First National did the same and showed leadership in the market. I work with smart clients and smart colleagues and it makes a big difference at times like this.

Final thoughts?

We are open for business and ready to serve.

Russ is safely, securely and productively working at home but you can reach him at or any member of the First National commercial team at 1.866.298.0929.