A boutique brokerage and property advisory business has just surpassed $1bn in settlements, a feat it has largely attributed to the finance platform it launched one year ago to help brokers dive into commercial lending.
Simplicity Loans & Advisory was co-founded in 2017 by managing directors Jean-Pierre Gortan and Matthew Johnson to support traditional mortgage brokers’ expansion into the commercial space. The leadership team has since grown to include director Ivan Kampic.
“Since officially opening our doors in July 2017 with five people, we have increased our headcount to 15 and have plans to continue growing our team this year despite the COVID-19 crisis,” said Gortan.
“We have experienced 90% year on year growth, settling 50% ($500m) in the last 12 months as we introduced Marketplace Finance’s solution to the market.”
In July 2019, Simplicity launched online portal Marketplace Finance to help brokers write and manage complex commercial loans with ease, regardless of their previous experience.
According to Gortan, the new business quickly became their “growth engine”. So, while the sister companies felt the initial impact of the COVID-19 pandemic, it didn’t slow the team’s pace for long.
“As a business, we had a very strong pipeline leading into COVID-19, but that did take a hit when the pandemic escalated back in March, with some clients along with some lenders taking a step back,” he explained.
“That said, we found a large number of our clients could still see opportunities and wanted to push forward – and these clients needed more guidance than ever because of the changing dynamics in the lending market.”
This has contributed to the “clear industry demand” for diversification seen by Gortan, especially as residential lending cools.
“In a low interest rate environment, there is a lot of cash around looking for a return, and commercial lending has provided an attractive risk and return profile for these investors," the MD explained.
“[Diversifying] makes a broker’s job more challenging as there are new options available almost weekly, but for the savvy broker it provides opportunities to assist their clients where they haven’t been able to before.”
While the business has adapted and flexed in the 12 months since its launch to stay abreast of the rapidly changing market, the core vision driving Marketplace Finance of enabling brokers to write and manage commercial loans has “remained unchanged”.
“Our role is to provide a gateway to commercial lending for our referrers and to provide outstanding solutions for their clients,” said Gortan.
“Brokers have been approaching us looking to proactively diversify their earnings outside of their core residential offering. Like so many other trends, COVID has really just accelerated that pattern as brokers look to ensure their businesses remain relevant and secure.”