As many as one in three new self-invested personal pensions (SIPPs) with Dentons is investing direct into UK commercial property, the highest rate the provider has seen.
In the first ten weeks of the year, 41% of new SIPPs with Dentons invested in UK commercial property, up from 19% in 2012.
One reason for the surge is business owners taking the opportunity to buy premises from which they will, or already do, trade.
"If the business is going to pay rent, better into a tax advantaged pocket of their own wealth than someone else's," Martin Tilley (pictured), director of technical services at Dentons, said.
For other investors, property is attractive because it allows them to engage with their pensions in a tangible way, said Tilley.
Several Dentons investors have cited their disappointment with ‘virtual pensions', where they receive a statement once a year and where they have little understanding of where the funds are invested, by who and for what purpose, said Tilley.
"Property can be seen and touched, rental receipts can be seen monthly into the SIPP bank account.
"The client sees the asset and growth, this helps the client engage and take a more interested, active role in their pensions. The true use and reasons of having a SIPP really."
However, Tilley said Dentons' approach may make it a greater magnet for commercial property investment than other providers.
"We have a very common sense approach to property purchase and ownership - we allow the client a lot of freedom to choose their own solicitors, valuers, property managers (or self manage) and insurers - so we are attracting a larger proportion of SIPP property market."
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