History and Market Background
Smaller investors have traditionally found it difficult to directly invest in the asset class of prime commercial property, either because their funds were insufficient to acquire the asset, or, if sufficient, might expose them entirely to one property.
In 1990 in response to the unprecedented buying opportunities then available in the weakest property investment market of the Post-War period, Ratcliffes began to explore the possibilities of property investment purchase through tax-transparent syndication.
Research and Development
With the advice and assistance of Druces LLP, our long established (1767) City of London Solicitors, with whom we have worked closely for many years, an ownership structure was devised to provide protection for our Investors, flexibility in purchase negotiations for the Agents, and security for the Lender, where mortgage finance is arranged.
Since 1990 some 285 properties have been purchased in Ratcliffes’ syndicated investment structures to a total value circa one-third of a billion pounds. Our audited returns from our first syndicate resales from March 1991 to April 2021, confirm that to date 199 properties in 168 syndicates have been sold, over 90% of which returned profits to that date. With an average ownership period of 4.36 years, our Investors have received an averaged return on their invested capital of 65.7%, with an averaged annual compound return circa 19.75%, over the 30 year period, significantly out-performing the commercial property index, Investment Property Databank (IPD), and the FTSE All Share Index, which respectively report averaged annual returns for that time span of 8.32% and 9.21%.
112 properties held in 85 syndicates were acquired in geared syndicates, where mortgage finance enhanced the performance. Over an averaged ownership period of 4.92 years, returns averaged 77.67% on capital employed, with an averaged annual compound return of 22.65%.
Many of our Investors prefer our cash syndications which, with no borrowings, have a lower risk profile and provide a reliable income stream. For Investors now in drawdown from their Pension Funds these syndicates are an attractive structure. We have resold 87 such properties held in 83 syndicates, after an average ownership period of 3.88 years, achieving an averaged return on cash invested of 53.44%, and an averaged annual compound return of 16.79%.
For more information please consult our Syndicate