Successful track record 

In 2025, Firm Capital celebrated its 38th anniversary while the publicly traded Firm Capital Mortgage Investment Corporation (FC -T) completed its 27th year of being public since its October 1990 initial public offering. 

Firm Capital has been through many real estate cycles, including the 1990s era when bank prime peaked at 14.75%, and 5-year mortgages were at 12.25%. During this time, the company has experienced and navigated many different market cycles. 

At the recent Mortgage Professionals National Conference, Benjamin Tal, the Deputy Chief Economist at CIBC, said, “Canada is already in a recession and thinks the Bank of Canada must act quickly to bring interest rates down as the industry is facing the biggest test since the 1990s.” The early 1990s saw a market characterized by high unemployment, speculative overbuilding, and a significant price decline coupled with higher interest rates that were around 12.25% for a 5-year conventional mortgage. 

Current market environment 

The current market is defined by a structural housing shortage and an affordability issue. Mr. Tal also describes the painful reckoning we face today as the result of the US trade policy under the Trump tariffs. As you recall, the US tariffs were announced in February 2025, impacting the confidence of governments, industries, businesses, investors, developers, and consumers. The bottom line is that the housing market has frozen as the affordability gap widens – the pre-construction market has slowed sharply, particularly in BC and Ontario where the condo sector is already in recession. 

Mr. Tal has urged Ottawa to expand its proposed GST/HST relief beyond first-time buyers to help stimulate the housing market. Shaun Hildebrand, President of Urbanation, says, “With the condo market effectively on pause, developers have turned their attention towards purpose-built rentals. While it’s encouraging to see more rental projects getting underway, the level of rental construction activity in the GTHA is trailing behind other parts of the country and will not be enough to offset the supply shortage left behind by a lack of condo development.” 

Bridge lending programs and operating philosophy 

Firm Capital is a non-bank lender that exclusively provides bridge mortgage financing, including construction financing for low-rise housing, condominiums, multi-plex rentals 

and commercial projects. We also offer first mortgages and secondary debt on commercial/investment properties including stabilization loans. 

Other lending programs include inventory financing, land financing and alternative residential mortgages. 

Firm Capital has been supporting its Borrower clients in these markets, as we tailor-make a financing program to help Borrowers address their needs. We continue to work with our clients to move projects forward. It could be as simple as providing a short-term renewal. 

Sometimes projects need some patience. We have seen files in this current cycle where some institutional and private lenders tell their borrowers that their investors want their money back at critical stages in the project. Therefore, it is important for borrowers to work with a capital provider that has proprietary capital, a strong track record, can make decisions, and is prepared to work with you in difficult times. Currently, we are also looking for larger investment property bridge loans in the multi-residential, industrial, and retail markets. 

Our focus is to work with small, medium, and large private developers and landlords who operate in the major urban markets across Canada with deal sizes in the $1 million to $50 million plus range; we are also comfortable in underwriting transactions in secondary markets.

The company’s market knowledge, deal structuring expertise, and proprietary capital allow us to provide quick turnaround as well as creative financing solutions to meet their needs. We expect more opportunities in 2026 given that borrowers are experiencing protracted approval timelines from traditional lenders. Nevertheless, pre-development projects and land financings will continue to present challenges for developers. 

In addition to our conventional bridge financing lending business, we offer a distressed credit fund to help get Borrowers through short-term challenges and to assist in repaying maturing debt that should be renewed or restructured. 

In closing, we agree with Mr. Benjamin Tal’s economic forecast where he thinks: “the combination of lower rates, federal spending and eventual stability in US trade policy to lift the economy in 2026 & 2027.”

For more information please contact: Michael Carragher, Vice President, Mortgage Investments, mcarragher@firmcapital.com, visit https://firmcapital.com/mortgage-banking/, or call (416) 635-0221 Ext. 245.