This is the second and final part of the investment overview into UK and in particular London real estate from Artorius Wealth. In addition to Wealth Management and expert financial planning, Artorius Wealth offers a dedicated Family Office Consultancy Service, Private Office services and a dedicated Real Estate Advisory service.
Asian Wealth Times met with Jordan Williams from the firm on one of their recent client visits to Asia to drill down on the Real Estate Advisory service the firm offers.
AWT: What in your opinion is the best real estate investment in the UK. Is it London residential or commercial, or do other areas of the UK or Europe offer attractive capital gain opportunities?
There is no doubt that the UK Real Estate market, whether it be residential or commercial property has been seen as a ‘safe haven’ for many investors. The residential property market in particular continues to show its resilience despite the credit crunch, unrest in the Middle East and Eastern Europe, and troubles in the Eurozone.
In fact, we notice that both activity and prices increase when there is cause for concern around the globe, as individuals rush to ensure their wealth is secure in a safe environment. In addition, there is no doubt that the combination of a continued lack of supply of property (both residential and commercial) and the appealing fundamentals of the UK, keep the Real Estate market attractive for investors. Time and again, investors tell me of the appeal of the UK due to its strong legal system, growing economy, business-friendly policies, time zone, education system, history, culture and cosmopolitan nature.
We are currently advising a number of Family Offices and UHNW individuals to acquire high value commercial property in central London as they struggle to find any suitable options themselves. Relying on our wide network, we have been able to source some very attractive opportunities where we engaged in face-to-face discussions with the owners. UK commercial property, in particular in London, is currently very popular amongst foreign investors, however as an investor, I would always opt for central London residential property.
Whilst an investor may be able to achieve higher returns both in terms of income and capital appreciation in other locations in the UK and Europe, what the London residential market offers is security and stability yet still attractive returns. We are very principled when it comes to investing in London residential property and we continue to be successful in helping our clients to acquire investment property which has provided attractive returns.
The market is very mature but there are still some excellent opportunities within central London for capital appreciation. In order to achieve good levels of capital appreciation and yield, we are advising our clients to focus on those areas where there are significant infrastructure projects occurring, or where regeneration is in the process of taking place which should see property prices start to rise or in certain locations, continue to rise.
I would always advise my clients to focus on acquiring property within a ‘period’ building , whether it be a red brick mansion block, or a white-stucco fronted property, due its unique appeal – after all if you are buying in London, I have a strong feeling you should buy a property which characterises London. In addition, the property should be in good condition, on the raised ground and above, with low service charges (thereby try and avoid buildings with lifts), and within close proximity to an underground station and local shops and amenities.
At Artorius Wealth we are focused primarily on preserving our client’s wealth. We believe that by focusing on the right areas of the central London property market, not only will investors be able to protect their capital, but also achieve capital appreciation and strong, stable yield.
AWT: European countries are offering the 'Golden Visa' to overseas investors, is there a similar UK offering?
Yes the UK offers two main options which our clients decide to use. The first is the Tier 1 (Investor) Visa which is designed for high net worth individuals who want to relocate themselves and their family to the UK. Only a few hundred of these visas are granted per year.
The Tier 1 (Investor) visa category applies to the main applicant and all immediate family members, including spouse and children under the age of 18. Initially, the investor visa is granted for three years and four months and can then be extended for another two years, by providing evidence that an investment of at least £ 2 million was made in the UK. There is no requirement to demonstrate English language ability. Work, study and business activity is permitted. The length of time required to qualify for permanent residence depends on the amount of investment.
With an investment of £2 million – eligibility for indefinite leave to remain is granted after 5 years in the UK, for £5 million eligibility is granted after 3 years and for £10 million, indefinite leave to remain is granted after 2 years in the UK. Individuals are permitted to spend 180 days outside of the UK. The investment into the British economy can be made via investment into UK government bonds, share capital or loan capital in active and trading companies that are registered in the UK, all through a UK investment account.
Artorius Wealth has a lot of experience in helping individuals to achieve a Tier 1 (Investor) Visa working with a some of the leading immigration lawyers, whilst we run compliant investor visa portfolios across the risk spectrum. Our offering is unique in the market for the variety in options we offer to clients allowing the portfolio to be bespoke to the client’s risk profile.
The UK also offers a Tier 1 (Entrepreneur) Visa where individuals are granted indefinite leave to remain in the United Kingdom when investing £200,000 into a UK business as well as have the required English language capability (either a National of a majority English speaking country, a holder of accepted English language degree or accredited English language test). After 3 years it is possible to obtain a 2-year Extension Visa, whereby you will need to should have invested £200,000 in a UK business in the form of equity or an unsecured loan, you were appointed as a Director of a UK company within 6 months of obtaining the visa; and your investment has resulted in the creation of the equivalent of 2 full time jobs for 12 months.
AWT: We have read that some analysts in the UK believe the UK interest rates could stay low for decades would you agree and does that make property investment even more attractive.
I would certainly agree that we can expect to see a low interest rate environment for the foreseeable future and I would not expect to see any rate change until the second half of 2016. I definitely believe that low interest rates make UK property investment appealing to overseas investors. Artorius Wealth has assisted many investors to identify opportunities where the income is comfortably exceeding any borrowing costs they may have.
There is not really much more to say on this. As a wealth management firm, we are able to create bespoke lending solutions for our clients, leveraging off our relationships with some of the leading banks around the world, meaning our clients can benefit from low borrowing rates and favourable terms, better than if they were to try and source a lending deal themselves.
Through a combination of providing bespoke advice to clients as to what property they should be buying and sourcing attractive lending terms, clients are really able to use the UK real estate market as a valuable investment tool for wealth protection and wealth appreciation.
AWT: What can Artorius Wealth offer Asian based UHNW clients that traditional Estate Agents cannot?
The big difference is that Artorius Wealth purely focuses on our client as the buyer of the property to look after their interests and their interests only. The traditional Estate Agents that are well known to many Asian investors are paid by the vendor of the properties to look after their interests, usually translating into achieving the highest price for the property as possible.
We act solely for the buyer to ensure they are buying the right property, for the right price, and in the right way. We are not a volume based business and cannot be so given the amount of time we spend with each individual client. Our offering is very personal and we take the time to fully understand our clients motives, desires and personality which helps us to be able to acquire the best properties for our clients. We have access to the whole of the market and will physically preview each property we present to the client so as to ensure it meets their specific requirements.
Our client’s time is precious and therefore we ensure that they do not need to spend the time listing with a number of agents and viewing properties which look great on paper but actually bear no resemblance in real life. We have access to almost real time sales data and therefore we are able to advise clients what the accurate value of a property is.
This helps us when negotiating on our client’s behalf to try and achieve the very lowest price possible. Simultaneously as finding the property for the client, we would be guiding them on the most appropriate financing options and ownership structures to ensure they are buying the property in the correct manner as well as introducing them to solicitors.
We assist our clients throughout every step of the acquisition process, and even once the property is bought, we assist to ensure that a tenant is found, the rent is collected, the property is maintained, is safe and secure and adequately furnished. Our service is akin to a ‘property concierge’. It is this high level of personal service which clients, especially from Asia, really appreciate and value.
