|
Residential Property Syndicates
- Investing for less cost
and less risk
Residential syndicated investments for shared purchase
of UK and Overseas residential property in SIPPs or privately.
Following the pension rule changes announced in March 2006 it
is now possible for pension investors using SIPP or SSAS pension money to invest
in residential property through a syndicated structure such as that used by
Assetz for Investors. This
helps members with all levels of capital from £20,000 upwards invest
in residential property both in the UK and abroad and to obtain access to larger
investment opportunities on a shared basis with other investors.
It also lets
investors spread their equity over more than one investment hence reducing
risk and exposure to just
one building. There are two types of syndicate and
these are detailed below.
The syndicate will typically consist of 5-20 investors. The
syndicate will provide limited liability for the investor and offer potential
tax efficiencies by acting as a tax transparent structure (please seek confirmation
from your adviser) to ensure tax is paid at the rate of the individual syndicate
member.
We also arrange commercial property syndicates and if
you're interested please visit the information
page here.
UK Residential Bulk Purchase Syndicate
The first of these UK residential syndicates will be launched
shortly and we are taking registrations of interest at this stage. The property
will
be bought off-plan at negotiated discounts (10-20% target) directly
from the developer.
Borrowing of 85%+ will
be used. The property will be held as an investment for around five years and
then sold into the market at retail price to achieve maximum capital growth
for the investors.
The strategy for the syndicate is based upon the established
processes used by Assetz for Investors in sourcing individual investment deals
for our clients.
Overseas Residential Bulk Purchase Syndicate
The first of these overseas residential syndicates will be
launched shortly and we are taking registrations of interest at this stage.
The property
will
be bought off-plan at negotiated discounts (10-20% target) directly
from the developer.
Borrowing of 85%+ will
be used. The property will be held as an investment for around five years and
then sold into the market at retail price to achieve maximum capital growth
for the investors.
The strategy for the syndicate is based upon the established
processes used by Assetz for Investors in sourcing individual investment deals
for our clients.
Frequently Asked Questions regarding syndicated investments:
1. What is the minimum investment for a syndicate?
Usually £20,000.
2. What are the costs above those I would pay if I bought
the property myself?
Our charge for syndicate organisation is a standard 2% of the building value.
This is paid as a deduction from the contributions by members initially.
3. How long will my money be invested in property for?
Typically residential syndicates will be holding the property for around five
years. However, it is possible to come out earlier subject to the syndicate
rules
or to extend the period subject to syndicate member votes. Syndicates are not
liquid investments and if you require your money sooner than the planned exit
then you should not invest.
4. Can I use my pension money to invest in these syndicates
as well as private money?
Yes this is possible and we have an FSA regulated advisor to assist with advice
concerning this and also to migrate pension funds into a property-friendly SIPP
structure if required.
5. I may need to leave the syndicate early – can
this be done?
Yes this is possible subject to the rules of the syndicate – the shares
must be offered to existing members first and then to outside members to join
in your place. In the event that more than one syndicate member wants to buy you
out, the shares are apportioned pro-rata to existing rights. Full details will
be provided in the legal documents once your syndicate reservation is confirmed.
Contact Us
If you wish to contact us online, please fill in the form below and we will
reply to you as soon as possible.
Risks Notice:
Operating within a syndicate can reduce the risk of investment
if diversifying across several properties and gives access to possibly lower
finance and better management than normally possible by a smaller investor,
however, like all property investments, there are
some risks:
- Void periods
- Mortgage rates increasing
- Changes in pension regulations if investing through a pension
- Less liquidity than if the property was owned by yourself only
- Professional charges could change and reduce the returns
- Property values could go down as well as up
|
