Montreal commercial real estate lending firm VA Capital is responding to market demand in becoming the first Canadian firm in its sector to attain B Corp certification, its president says.

As awareness of environmental, social and governance (ESG) principles in day-to-day operations and in investment portfolios continues to grow, founder and president Jeffrey Soliman told Sustainable Biz Canada it is gratifying to be recognized as a leader.

"It’s beyond exciting because we work very hard and always strive for the best . . . To be recognized with the B Corp certification was overwhelming for us because it’s a natural fit.”

B Corp certifications are allocated by B Lab, a Philadelphia-headquartered non-profit recognizing companies that meet its ESG standards for businesses.

Soliman said VA Capital's initiatives include promoting sustainable financing and habits in the workplace, in addition to making financial donations for every loan the company finances, and sponsoring a scholarship for women in real estate.

VA Capital’s impact

Founded in 2019, the company specializes in commercial loans across residential, commercial and industrial properties. In five years, it processed $5.5 billion in loans, with close to half of that figure in 2023, Soliman said.

Adding value to its proposition is key to VA Capital, he continued. The company donates a portion of each loan to a charity of its clients' choosing, and contributed $25,000 toward a scholarship at Concordia University to bring more women into the real estate industry.

The growing interest in ESG pushed VA Capital to educate its clients on sustainability criteria that must be met so projects can qualify for better financing. He said some lenders have asked VA Capital to assist with clients heavily involved in sustainable buildings and financing, or to be introduced to other clients in that field.

“In the past couple of years, lenders have made it a point that, if you do not express or show any ESG ambition within your portfolio or enterprise, then we may not have any interest in financing you. The trend is real, the impact is real.”

For example, Canada Mortgage and Housing Corporation (CMHC) financing requires alignment with its affordability and energy efficiency requirements. Soliman said it rests on VA Capital to explain the CMHC’s requirements to its clients so they can qualify for ESG loans, such as explaining the cost benefits of energy efficiency upgrades.

He said VA Capital has made a “massive difference in educating the market and aligning the right people in the right direction.”

Receiving the B Corp certification

The B Corp certification recognizes VA Capital’s impact on governance, workers, community, environment and customers.

Soliman asked himself how he could apply what VA Capital built toward impact financing. He looked around for the certifications that would recognize the company for its value and the knowledge it shares with clients.

He was urged by a friend to look into B Corp, and saw the standard lines up "exactly to what we were trying to reflect for us internally."

Attaining the certification required internal and external surveys, reporting data and meeting a series of commitments. To assist in the process, VA Capital brought on a corporate advisory officer.

In day-to-day operations, VA Capital’s employees were encouraged to use less plastic in the office and use for sustainable transportation options to get to work. After Soliman’s experience as a father to a newborn, the company offered new parents financial assistance with night nanny services.

B Corp certification helps the company by setting it apart from the rest, Soliman said. The company can educate and share knowledge with lenders at any stage of their own sustainability journeys.

“On both sides, it definitely checks a green mark for positioning us well within the industry, but . . . we also get to give something back in terms of the knowledge.”

The goal is to lead by example, according to Soliman. As VA Capital continues to evolve as a lending firm, he aims to build funds that will have guidelines for sustainable financing.