Investment Strategy

The managers of the Northern Citadel Mortgage Investment Trust have identified a niche market that has been underserved by the large lending institutions. Specifically, the Trust invests in commercial and residential mortgages that are secured by first and second mortgages on real property and are held by smaller borrowers. These borrowers fall into the ‘second tier’ of the Canadian mortgage market – between the low-risk, low-yield ‘first tier’ borrowers that the banks primarily target and the high-risk, high-yield ‘third tier’ borrowers who struggle to attract investment.

This strategy is designed to obtain superior yields, maximize distributions and increase unit value. There is limited competition in this second tier, which means that the Trust can mitigate some risk by controlling interest rate pricing to a certain degree. 

In order to fully exploit these opportunities, Northern Citadel has assembled a team of experts from all aspects of the business, from actual design/builders and real estate professionals to lawyers and mortgage investment brokers.