Commercial lending is up - why should you care?

Today the BCREA put a news release that commercial property movement is on the rise. I have to admit, it put a little jump in my step. I do not pretend to be an economist or fully understand how and why our economy rises and falls, but I do try to stay on top of things and listen to people who profess to have this knowledge. I can't know everything, but at least I try to find out who knows what I don't.

Among other things, I represent banks and lenders who provide loans to businesses - commercial lending. So naturally, when I hear that commercial property movement is on the rise, my pocket book is getting ready to expand and that makes me happy.

But this news could be far more important than my practice.

A few months ago, I had the privilege of hearing a chief economist of a leading Chartered Bank speak about the economy. The buzz at the time was Greece and its looming debt, and Europe in general. Among all the new information and statistics that were tossed out by the presenter, a few simple poignant tidbits stayed with me.

The business community has suffered along with all the individuals in Canada and the US. When the mortgage crisis in the US reared its ugly head, we felt the crunch. Borrowers got nervous. People were afraid to buy houses. What most of us non-business owners didn't realize, was that the business owners were nervous too. So, instead of leveraging their assets to raise more capital to expand, they sat on their inventory and current assets. They were, in essence, afraid to grow. We need businesses to grow.

The chief economist, suggested that that until our business community is willing to share the risk, our economy will be stalled. Spending by you and me, is simply not enough to really invigorate the economy, it just helps prevent it from slipping further.

So, the reason of my jump in my step this morning, is that maybe, just maybe, the rise of commercial property movement and ergo, lending, is the beginning of a trend and a true indicator that our economy is really on the mend.

If your lawyer is not helping you, ask yourself why not.