SIPP provider Pointon York SIPP Solutions (PY) has teamed up with estate agent Jackson-Stops and Staff to provide a property search service for IFAs and their clients looking for commercial property deals.
The service will look to match properties with specific client needs, although eligibility will depend on either having a PY SIPP already in place or liquid funds ready for a purchase.
IFAs must register the amounts their clients intend to invest in either one or multiple property syndicates - possible under existing SIPP rules.
Linking clients with commercial property deals in this way removes a significant drag on IFAs’ time with clients, and enables people to buy into property in a way they could not on their own, PY suggests.
Poole-based IFA Lewis & Co managing director Tim Lewis says its SIPP clients have seen strong returns on the commercial property bought through the syndicates it has set up with the help of PY.
”Stick to areas you know as an IFA, and areas that your clients know,” he says.
”Our clients love to go an look at the bricks and mortar they own.”
Lewis says commercial property makes increasing sense because rental yields have held up well historically compared to other asset classes - meaning income streams are strong quite apart from any capital gains made.
And the gearing currently allowed by SIPP rules means the risk/reward ratio can be played with, for example, by targeting properties with high quality clients such as branches of FTSE 100 companies on the high street, in turn removing much of the risk associated with leases while further strengthening returns.
A-Day will see current rules eradicated, of course, including imposing a question mark over the amount of gearing possible.
However, until then there is still a strong argument for looking to syndication and commercial property say both Lewis and Christine Hallet, managing director PY.
”The rules are as they are today, that’s come down from the Revenue,” Christine says.IFAonline
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