AFTER building its business during the last 10 years by managing its clients' assets, Wellington West Capital is branching out to the debt sector with the addition of its latest division.

The Winnipeg-based brokerage recently opened its own mortgage broker operation, called Wellington West Mortgage Services. Run by newly recruited Jim Tourloukis, its Toronto-based vice-president of business development and a 10-year industry veteran, WWMS will source the best rates for clients looking to purchase their first property, those whose current mortgage is set to expire and people who locked into a long-term plan prior to interest rates dropping to 40-year lows.

"The key is our clients now have a resource to allow them to get the best possible rate they could ever get in the market," he said in a telephone interview.

Tourloukis noted while he will remain in Toronto, WWMS is based out of Winnipeg.

He said on average, half of all Canadian households have mortgages.

"(Wellington West) has 32,000 household clients so that's 16,000 potential clients who have a mortgage or mortgage needs," he said.

He said the service will be offered free to the firm's clients but he expects WWMS will have revenues of more than $1 million within two years. It will receive a commission of approximately one per cent of the value of each mortgage from the mortgage issuer.


Tourloukis said the presence of John Rothwell, Wellington West's Toronto-based partner who is spearheading its national expansion and with whom he worked for seven years at Fidelity Investments, convinced him to make the move.
"The mortgage business is very immature in Canada relative to what it is in the U.S. It's another tool that differentiates us from our competitors," Rothwell said.

Charlie Spiring, CEO of Wellington West, said the creation of WWMS was predicated by clients asking for advice on the best mortgage terms and rates. He said it also enables the company to "beat the banks at their own game."

"(The banks) supply the mortgages and we're the mortgage broker finding the best rates. (Mortgages) are a pure commodity, we don't care which name is issuing it," he said.

"It's another arrow in our quiver for our brokers to satisfy their clients' demands. We don't want to become a supermarket of (financial products) but where we can clearly add value to our clients, we will. We're comfortable that if we're not the best at something we'll find who is the best for our clients," he said.
Keith Sjogren, a consultant at The Taddingstone Consulting Group in Toronto, said Wellington West is following the lead of other firms which have added mortgages and other services such as insurance and estate planning to their offerings.

"I think it's an expansion that's not unreasonable," he said. "ING Direct recently acquired a mortgage brokerage to stimulate mortgage demand and the establishment of mortgage brokerage firms by non-traditional firms is happening more and more."

Sjogren noted there has been a steady increase over the last few years of the percentage of mortgages that are arranged through brokers rather than the underwriters.

"At one point, the majority of mortgages were arranged by people going into their banks and sitting down with their banker. Now there's much greater use of mortgage brokers because it saves (consumers) time and money," he said.