The director of Perry Finance has had to crack down on his business’ organisation as he prepares for a ‘new normal’ in lending
From his Melbourne office in the commonly dubbed ‘Paris’ end of Town, Cameron Perry offers his clients the broadest range of commercial finance in our top 10 list this year. While the vast majority comes from development finance, a fifth of his loans were from commercial real estate and an even spread between equipment and asset finance, debtor finance, unsecured business lending and SME finance.
Not content with just commercial, Perry Finance also offers residential mortgages. “We do home loans; most of our clients have home loans as well and have equity in their property,” the father of two says.
The focus on property development has been there from the start of his broking career, when Perry and his brother began it as an add-on business to their father’s property business back in 2004. The finance arm split off when the licencing changes came in during the GFC and it grew from there.
Fast forward to today and Perry says the last 12 to 18 months has seen another credit crunch scenario and it’s becoming increasingly difficult to meet the banks’ criteria. “It’s become increasingly difficult for them to service loans once the client has two or three investment properties, just down to the changes that lenders have introduced,” he says.
After the GFC, Perry branched out into more private funding, which has helped him a lot in the past year. Very few of his property development loans were written through banks, which means he also needs to educate clients on what the alternatives are. “It’s a challenge because of the difference in pricing and the different ways that private lenders operate,” Perry says.
Although he admits he does not do a lot of them, he still uses the major banks for areas like small business loans; but he finds he is turning more and more to second tier lenders for commercial investment.
To accommodate the changes to the lending environment, Perry’s business has had to focus on becoming more organised on its processes, which he says has not been a bad thing.
Looking ahead over the next 12 months Perry thinks the tough lending market as it stands is “a new normal”. He also expects this will increase the level of competition among lenders, which he hopes will bring about a larger benefit for his clients. “I think some of these other players coming into the market are currently quite expensive, but with the competition I think there’s going to be more reasonable price alternatives, so it’s quite an exciting space,” he says.
“Banks will probably stay fairly similar, that’s my feeling, but I think there’s going to be quite a lot of activity in the non-bank sector.”
Total value of commercial loan settlements: $79,057,200
Number of commercial loans settled: 36
Average commercial loan size: $2,196,033
Years as a commercial broker: 14
Aggregator: Connective
