We invest in fixed-rate, first-mortgage loans that are generally secured by high quality, income producing office, retail, industrial or multi-tenant residential buildings and properties located in core markets with strong long-term economic and demographic growth prospects.
The stabilized properties are owned by well capitalized, experienced real estate investors that employ professional property managers. The properties have low vacancies, are occupied by a diversified and financially sound tenant base – and have loan-to-value and debt service coverage metrics that provide protection during adverse market conditions.
Our commercial mortgage team has more than 60 years of lending experience, with over 53 investment professionals* integrated across origination, asset management, asset servicing and credit risk.
- Enhanced yield: Over the long term, commercial mortgage loans have consistently generated a spread premium over comparably rated public bonds due to a combination of the illiquidity premium and bespoke nature of the loan.
- Diversification: Commercial mortgage loans have demonstrated moderate to low correlation to traditional fixed income asset classes and low correlation to real estate equity.
- Reduced volatility: Commercial mortgage loan cash flows can be less susceptible to event risk, given that revenues are derived from multiple tenants and diversified by industry and geography. Downside protection can be achieved through the structuring of additional credit enhancements to mitigate any perceived cash flow risks.
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* Investment professionals include Portfolio Managers, Traders, and Research Analysts under SLC Management which includes: SLC Management (Canada) Inc., SLC Management (U.S.) LLC, and the Sun Life Investment Division.