Investors hardly need to be reminded that the stock market isn’t what it used to be. What a difference three years make.

GICs and other bank offerings are a safer bet, but interest rates these days aren’t much bigger than those numbers on the end of movie-sequel titles.

However, deals that offer far better rates can be risky.

People who want their hard-earned money to work for them at a reasonable interest rate often turn to an established, prestigious firm such as the Howard Group, which prides itself on steering clients toward investments with a good rate of return but minimal risk.

The high-achieving Axcess Capital Partners/Howard Group team includes, from left, Bill Buterman, Peter Weichler, Grant Howard, Trevor Stott and Jim Masleck.

The Howard Group recently formed an alliance with another respected Calgary company – Axcess Capital Partners – to offer clients safe, high- yielding investments based on mortgages.

Axcess arranges short-term mortgages for real estate and property owners, primarily in Alberta and British Columbia.

The mortgages are typically 12 to 24 months’ duration, with yields of 10 per cent or more, up to 14 per cent in some cases.

That kind of performance is just what the Howard Group’s Jim Masleck was seeking for his clients, investors with sums ranging from $25,000 to the hundreds of thousands.

“I was out shopping the market and I wasn’t all that impressed with what I found at first,” says Masleck.

“Then I came to see Bill (Buterman) and Trevor (Stott) at Axcess and they really impressed me, in terms of the product offerings and their approach to the business.”

Masleck came to the conclusion that Axcess had high standards when underwriting in the mortgage investment business, and he was right. The company strives to exercise proper “due diligence” in “checking out” a potential mortgage investment.”

As Buterman explains: “Mortgage lending is primarily an assessment of two things – the Risk OF Foreclosure and the Risk ON Foreclosure.” In other words, is there sufficient cash flow and is it secure enough to maintain the debt load? Then, conversely, if the cash flow ceases, is there sufficient equity to recover the investors’ capital. Keeping that in mind allows for some very good investments and excellent returns. In the long haul, real estate is one of the economy’s less perilous forms of investment. It remains relatively stable and secure.

But for the people at the Howard Group and Axcess Capital, the key is to understand that a file can fail. Thus each project or building in question must be scrutinized in a detached way, with close regard to an exit plan if there were such an occurrence.

Buterman cites the example of a $1-million building on the edge of downtown Calgary. “It returns 10.375 per cent over two years,” he says. “The mortgage is 62.5 per cent of the value of the building, so there’s more than $600,000 equity left in it. Cash flow is roughly $15,000 a month gross. And the payments are $7,500.”

Another Axcess file involves a Vancouver building worth $21 million, on which investors hold a mortgage of $12.5 million.

Because the owner’s equity is close to $8 million dollars, he has a great deal of capital at risk and to subsequently lose if our investors were to have to “Realize” on the security.

This cautious approach pleased Masleck from the start. “What we really saw here in Bill and Trevor was their due diligence process, and their genuine concern for the investors’ capital, which we thought was substantially different from many of their competitors out there.”

Axcess also has a very strong policy of dealing only in arm’s-length transactions – that is, projects in which the company or its people have NO personal stake. Otherwise they’d be reluctant to quickly resolve when common sense warranted it because it was their “baby” . . . and surely if we just give it more time, blah, blah, blah . . .

By being independent, Axcess can react quickly for the safety and for the benefit of their investors. For an investment that is REAL – “real property, with real security with real returns,” call Jim Masleck in Calgary at 403.221.0915, or toll free at 1.888.221.0915, or e-mail him at jim@howardgroupinc.com