The biggest challenge for the market is the fear of the unknown
Tom Cantor, Head of Bridging Finance, West One Loans
West One's new head of bridging talks about his plans for the division, how the cost of living crisis affects bridging finance demand, and opportunities in 2023.
Since joining West One as an executive in 2019, Tom has played a leading role in the development of its bridging team. After gaining senior-level experience across all areas of the business, he helped the firm enhance its relationship with brokers, complete its largest-ever bridging deal, restructure its product range and build an internal lending operations system. Now, he is taking responsibility for the division's profit and loss, business origination, loan book performance and overall operational efficiency.
Q: Congrats on your promotion. What will you be focusing on first?
Market turbulence and economic uncertainty mean that our priority now is to ensure we are lending responsibly and pricing appropriately. Our expertise ensures we are in the best possible position to help improve access to finance, particularly as demand for short-term finance continues to grow.
Q: What one thing does the industry not know about you?
I took an unconventional route to my career. I studied history at university, then joined a corporate banking graduate programme at the Royal Bank of Scotland. That led to a job as an assistant director in the financial sponsors team, providing debt to private equity transactions. I later joined Baylor Klein as an M&A associate in the household, personal care and beauty sector.
Q: West One recently expanded its bridging team in the North. Will brokers see more regional expansion next year?
We are always looking to grow our regional distribution and have recently merged our bridging and development finance sales teams. Our BDMs will cover both areas and give us full coverage across the UK. It's important for us to have a strong footprint in every region and employ people with in-depth knowledge and experience of local markets.
Q: How are rising base rates and the cost of living crisis impacting bridging finance demand and exists?
Demand for bridging loans and other forms of short-term finance remains high overall. however, with so much change and uncertainty, the market is less confident, and this is reflected in the type of enquiries, which are more speculative. There is likely to be a lag, as some wait to see how things play out. Generally, larger businesses will be better able to stomach a rise in interest rates, but this is more difficult for smaller landlords, so demand will vary. Exits will be affected as interest rates and the cost of living impact the two main types - sale and refinance.
Q: Are you expecting an increase in regulated bridging?
The latest Bridging Trends figures show a 20% uplift in bridging loans between Q2 and Q3 2022, with regulated bridging in high demand. We are seeing a similar trend and this may continue into 2023 as people come to the end of their fix and cannot afford to refinance. Downsizing to something more affordable will be an option so, over the next 12 months, I think regulated bridging will become more important for people who want to move quickly.
Q: What opportunities and challenges do you foresee in 2023?
As part of Enra Specialist Finance, we are backed by one of the world's largest investment companies, Elliott Advisors, so we're in a strong position to support brokers and their clients. The biggest challenge for the market is fear of the unknown. It is very hard to predict the impact of higher interest rates on house prices and the knock-on effects for investors.
Q: Could we see investors capitalising on transactions below market value?
In tough conditions, there are always people looking to capitalise on emerging opportunities, so there may be investors keeping cash ready for deals down the line. More foreign investors may enter the UK market, particularly from the US because of how the dollar has moved against the pound.
Q: If you could change one thing about the bridging finance sector, what would it be?
Technology. There's a big opportunity to incorporate better fintech to improve the intermediary experience. For a long time, we've been investing in technologies to offer a compelling lending experience.
Q: How did you spend your first pay cheque?
It's been so long I can barely remember, but probably on a night out.
Q: If you weren't doing this, what would you do?
I always wanted to be a policeman growing up.
Q: What is your karaoke song?
I tend to run away when the microphone comes out, but I did sing 'Don't Look Back In Anger' by Oasis at my initiation for the university football team.
Q: Office, WFH or hybrid?
Office, no question about it.
Q: Any hidden talents?
If I do, they are so hidden that even I don't know about them!