In this episode of WealthTalk, Christian Rodwell and Kevin Whelan dive deep into the world of property investment with Sam Faulkner, principal of SIRE Capital Partners.
Together, they uncover the emotional pull that property holds for many investors and reveal why healthcare properties are becoming a standout choice for those seeking stable, long-term returns.
You'll hear Sam break down the strategies behind joint ventures, how to create recurring income streams, and why demographic trends are driving demand in the healthcare sector.
Plus, they explore how tax-efficient structures and even pension funds can be leveraged to supercharge your property portfolio.
If you're serious about understanding the opportunities in operational property and want expert guidance on building a secure investment strategy, this episode is packed with valuable insights you can put to use straight away.
Tune in and learn how to make smarter, safer property investments!
Resources Mentioned In This Episode:
>> SIRE Capital Partners [Website]
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>> Join the WealthBuilders Facebook Community
>> Schedule a 1:1 call with one of our team
>> Become a member of WealthBuilders
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Christian Rodwell (00:02.018)
purpose of Wealth Talk is to educate, inform and hopefully entertain you on the subject of building your wealth. Wealth Builders recommends you should always take independent financial, tax or legal advice before making any decisions around your finances. Today's episode is brought to you by Wealth Builders Membership, a proven step -by -step process that helps you achieve financial security within two to three years. find out more, head to wealthbuilders .co .uk forward slash membership.
Welcome to this week's episode of Wealth Talk. My name is Christian Rodwell, the membership director for Wealth Builders, joined today by our founder, Mr. Kevin Whelan. Hello, Kevin. Hi, Chris. Good to be with you again. And yet another interesting opportunity for knowledge you've sought out today and the fascinating one, isn't it? Yes. Yeah. Today we've got a wonderful guest, Sam Faulkner.
And we love businesses with a niche, don't we, Kevin? And especially those that have got a high degree of recurring income. And Sam will be sharing how his business, Sire Capital Partners, covers both of those areas. Yeah. I love niches, as you know. And, we'll get to see what he talks about afterwards and have a little bit of a debrief of the niches. But I think the three things we say are important. One is be outstanding in the niche. Two is have a recurring income.
And three is the business must be able to work without you delivering the work. So you genuinely own the business. And you can see that any business that links to property with a special niche that we'll discover is a fascinating and interesting one to understand. if you're familiar with wealth builders and the wealth talk podcast, you would have heard us refer to our seven pillars of wealth in the past, which are the seven assets that you can.
used to create multiple streams of recurring income. we're touching on business, we're touching on property today, we're touching on pensions and also joint ventures. So quite a bit covered. Well, there's a lot to unpack today. So let's stop waffling on and get to it. All right, let's head on to our conversation today with Mr. Sam Faulkner.
Christian Rodwell (02:15.0)
Sam, welcome to Wealth Talk today. How are you? Hi, Christian. Thanks for having me. I'm doing well. Great to have you with us. We're excited to find out about your business. And you are the principal of Sire Capital Partners. And Sire is a data -driven real estate investment company. So give us the overview on exactly how does Sire work. Sure. So Sire stands for Secure Income Real Estate. And that's really what we're focused on. So we would invest in anything.
commercial real estate, but we're focused on the sectors and assets that have a secure income profile. So we look, we take it sort of top -down view of the investable universe and we look for those sectors which have the most secure forms of income. And for us at the moment, and for actually probably the last three or four years, that's really been healthcare.
So tell us bit more about healthcare and why is there such a secure investment in your eyes? Yeah, so healthcare is an interesting sector. It's an operational type of real estate. And what I mean by that is that the kind of success or failure of a particular property is highly linked to the success or failure of the operational business that operates in that location. So for example, if you think about a
a dentist, for example, if a dentist operates their practice very well, they will tend to build up a patient list within that geography. So often all of their patients or 90 % of their patients will be within sort of three kilometres of the location of that practice. Now it becomes essential for them to
remain in situ, so they want to stay in that building, in that property, because they've built up their patient base there. It's very, very difficult for them to pick up and move to another location without having to restart and rebuild that patient base. So we think of that piece of commercial property as really sort of mission critical to that dentist. And from a landlord's perspective,
Christian Rodwell (04:32.408)
that's a strong position to be in because if we need to negotiate things like rents or having other negotiations with the tenant, they are really kind of tied to that business. On the flip side, because it's an operational real estate class, if that operational business performs poorly, that dentist is unable to maintain a profitable business in that location, that then means that
our rent is at risk because if the dentist isn't making a profit, then we as the landlord aren't able to take a share of that as our rent for the property. what would be some examples of, I'm guessing, dentists, GPs, what else is included under that healthcare umbrella? Yeah, so we break down healthcare into three themes. So we've got cure and prevention.
which is dentists and GP. We tend to say GP anchored health centers. So often you'll see a GP surgery, it'll have a pharmacy, maybe you'll have physio or some sort of ancillary services there. So that's cure and prevention. The second one is care. This is a large and really growing sector in the UK and that is predominantly elderly care. You do also see some sort of special needs care.
and that's based people with mental health issues or perhaps sort of criminal backgrounds as well. So our focus within care is on elderly and that can be residential dementia. So nursing or residential care. And then the final sector is retirement, which is actually a really nascent sector in the UK. It's a lot bigger.
in other parts of the world, like New Zealand, where I'm from, for example, retirement villages are a much bigger thing per capita. The US and Australia as well, but the UK is, it's a growing market, but it's still quite sort of early stages. So our main focuses are on dental practices, GP surgeries, and care homes.
Christian Rodwell (06:49.132)
Yeah, and care homes, senior living, I know you've done some research. There's many factors that back this argument up, isn't there, that this is a growing industry? Can you share perhaps what some of those different elements are? It's the increase in the elderly population within the UK. That's the simple demand driver behind why we need more care home beds. So we did some work. We took some statistics from the ONS.
And we looked at the, of all the UK regions, what percentage of those had 25 % or more of the population being aged 65 or over. And we got that data from 1991 all the way through to today. And then the ONS really usefully, they produce a forecast of where that's going out to about 2040. And so you can see if you actually draw a heat map of this back in 1991,
there are only about six regions in the UK which had 25 % or more of the population over the age of 65. If you fast forward all the way through to today and into the forecast in around 2040, it's something like 236 UK regions will have 25 % of the population or more over the age of 65. And there's no inputs into that forecast which are
politically sort of driven. So whether it was labor or conservative, it doesn't matter. It's entirely based on demographics. And the key things that are driving that are, one is the Baby Boomer cohort, which was born after World War II, coming into retirement age. The next one is that people in general are having fewer children and having those children later in life. And then finally, there's just general improvements.
to life expectancy, so mortality rates have come down. And the combination of all of those things is showing a dramatic shift in the makeup and demographic of the UK population. And so that's what's driving the demand for care home beds, but it's also demanding for sort GP facilities as well, because people in that older age cohort tend to use GP surgeries a lot more than.
Christian Rodwell (09:14.638)
than younger people as you can imagine. I'd definitely like to get into exactly how the investments work and some of the actual processes within Sire in a moment with you, Sam. But Sire is a joint venture almost. It's not just you. This is something that you join forces with Patrick. And joint venture is Pellet 7. It's something that we advocate as a really good way of bringing different skill sets, different values, people who share a common vision.
and creating a win -win. And that's something that you've done. So how did that joint venture come about and the setting up of Sire Capital Partners? So I work with another one of the principals at Sire Capital Partners, Patrick Ryan, who is another Kiwi. And so we met through a networking event for actually Kiwis working in property in the UK. And so Patrick had been
in London since around 2000, started out in banking and then had a mezzanine finance business up until around the GFC. Post GFC, he wanted to get into some more secure income real estate for probably some obvious reasons after that really volatile period. So he launched a company called Sire Properties. I think it was around 2014, 2015.
The focus there was still on secure income. I was working for CBRE Investment Management when I moved here from Auckland and moved to London and I worked with CBRE from 2017. I was a portfolio manager there working with large pension schemes, sovereign wealth funds, that kind of institutional capital. One of the big trends in commercial real estate is around
If we have these pension schemes, have been sort of the older model where when you retire, you get a percentage of your final salary, they're called defined benefit pension schemes, and you get that paid to you until you die. Those are almost all closed now. So those defined benefit pension schemes are kind of in runoff. And they have been the large owner of commercial property for a long time. And the reason is that they can
Christian Rodwell (11:38.488)
they can withstand the illiquidity. so that higher income yield that you get from property in exchange for the illiquidity of a commercial property, that's a great place for that money to sit in those defined pension schemes. But as they wind down, we now have a trend moving away from these types of pension schemes into more self -controlled or some degree of control.
over the actual individual who will ultimately be retiring and funding their own retirement. So things like your ICER, your SIP, your SAS. And so for large commercial property managers, the question was, how do we move away from servicing these institutions like the pension schemes? And how can we start accessing and giving service to private individuals who still want access to alternative investments like
like commercial property. And that was a project we did at CBRE. And it was something I became really interested in seeing several other large sort of commercial property managers, private equity managers, starting to offer products to private investors. And so that was a place, a space I really wanted to get involved in. And Patrick had launched this business side properties. It had a good potential for growth. And he was targeting high net worth.
individuals, so private investors who wanted to invest in commercial property. Now he had always done one investor, one property. So what we call direct real estate investment. And unless you are really, really wealthy, sort of in in the, least high net worth to ultra high net worth space, or you're a small family office, it's very difficult to grow a portfolio of commercial property, owning 100%.
of each of those assets. So part of the plan when I joined up with Patrick in 2022 was to create the ability to commingle high net worth investors together so that they would have more purchasing power, so they could then have a sort of a bigger investable universe that they could access.
Christian Rodwell (13:57.422)
And so we went down the path of getting FCA approval because we're becoming a fund managers. We need to be regulated. And we've now launched what we call our single asset fund series focusing on healthcare. Sometimes these are called syndications. They tend to be sort of 10 to 20 investors pull their money together and then they go and acquire a, for example, a care home that might be
eight to 10 million pounds. And so we source those assets and acquire them, and then we manage them over the long term. And we're in the sort core income space. So we're focused on long -term income streams with some sort of link to inflation protection. And that fits really well with healthcare because as I was saying earlier,
You have a strong geographic market if you're a healthcare provider. And so you want to have a long -term lease on that property. So typically you'll see minimum sort of 10 to 15 year leases on healthcare properties. And the tenant is responsible for maintaining those properties. They want to keep them in good order with good fittings and fixtures. They want to keep the paint in the carpet and all of that up to a high standard so that they're
their customers are happy and their operational business is profitable. So we're able to get really long -term inflation -linked income by picking the right healthcare properties. And then in turn, we syndicate that and we give a nice recurring income yield back to our syndicate members or investors.
saying to our members, investing for capital or you investing for cashflow? Definitely I can see the cashflow side here. Is there any capital events that occur as well? Or is the model a cashflow model for the investor here? The income is definitely our focus. And we sort of have done some research on this. If you look at the MSCI or Property UK index since, I think it's been around since the 1980s. So it's a really long
Christian Rodwell (16:20.462)
term commercial property index in the UK. It's across all sectors, the major ones and the alternative sectors as well. Now, MSCI helpfully splits out that index into the income component and the capital component. So you've got a really broad cross -section of UK property going back to the 1980s up until today. So one of the questions we asked was, how does that split work?
over the longest time period you can imagine. So you've got all sorts of crises, dot com crash, you've got the GFC, you've got COVID and so on. How does it split between income and capital? And it works out at about just over 70 % of the total return on that index has come from income and around 30 % has come from capital. So for us, it makes more sense to focus on the income
which is contractually agreed, it's current. And so it's more real. I think you should be giving it more of a weight in your assessment. So the capital appreciation is good. It's nice to have. the way we underwrite an asset is when we buy it, we buy it at a particular yield. So say it's a 7 .5 % yield today. If we're thinking of selling it in, say, seven years,
we typically leave the yield constant. So if we buy it at 7 .5 % today, we assume we're going to sell it at 7 .5 % in seven years time. So interest rates could go up, could go down, but over seven years, it's quite hard to put your finger on where you think those yields are going to end up. So the yields stay the same, but because we have inflation linked income, so every year the rent gets reset to
whatever the RPI index is. In seven years time, because we've got a larger rental income stream, when we capitalize that at the same 7 .5 % yield, we end up with a capital appreciation. But that capital appreciation is only going to be roughly in line with RPI, roughly in line with the rent growth for the numerator.
Christian Rodwell (18:42.222)
So it's sort of modest at 2 .5 to 3 % is I think where most people are expecting RPI to be over the sort of mid to long term. And I guess that's probably in line with the broader MSCI index where about 70 % of the return is coming from income and 30 % is coming from some capital appreciation.
That's great data. Thanks for sharing that, Sam. Kevin and I, did an episode of the podcast a couple of weeks ago. We did the four different investor types. Some people just literally just going all in and not really having much knowledge of what they're doing and really being risky. Others who just hand it all over to a manager, a fund manager and an IFA and just hope for the best. People have this love affair with property, don't they? They like to own property.
And that's something that's existed for a long time. And how do you address these issues around sort of control liquidity within the funds? Yeah, that's a really good question. And one we've spent a lot of time thinking about. And you're totally right. There's this emotional attachment to a piece of real estate and saying, that's my building. I can drive past it. I can show people that's mine. And people don't get that if you invest in a listed
So that's like a property company that owns probably 50 plus, 100 plus buildings and it's listed on the stock exchange and it kind of behaves sort of like a share and sometimes it behaves more like a property investment. But there's just no way that an individual was going to know, let alone form any sort of emotional attachment to the 50 or 100 investments in that company.
You do also have private real estate funds, which will own maybe 20 to 50 properties as well. Again, if you put in a lot of work, you could probably get familiar with some of those assets, but it would be hard to really know them that well. And so what we said was, so individuals really, want direct ownership. They want to own that building, but unfortunately they don't have sufficient
Christian Rodwell (20:56.302)
capital to buy 100 % of a high quality commercial property. It's just too expensive and it would take up too much of your overall portfolio. So what we did was we tried to create the closest alternative to direct real estate ownership. And so we've created single asset funds to do that. And that means that we set up a special purpose vehicle and all it
all it does and all it's ever going to do is acquire one property at the outset, and then it's going to last for sort eight to 10 years, and then that property will be sold, the money returned back to the investors, and the SPV will get wound up. And obviously in between that time, all of the rents will be paid back to the investor, the same as if they were a direct landlord. So the gross rents come into the SPV.
SPV has to pay some fees and charges. If it has any leverage, the SPV will pay the bank. And then whatever's left over goes back up to the investors. So that's the model that we created to try and get as close to direct ownership, but benefiting from the power of pooling capital together, which means that you can access larger, better quality assets and better quality tenants with bigger balance sheets.
less likelihood of not paying you the rent. that was the idea. In terms of the liquidity, commercial property is an illiquid asset class. There's no way around that. I think other fund managers have tried to create quite clever liquidity mechanisms and liquidity windows and that kind of thing. But you've really seen even the large managers that falls over because
if all of the investors in the fund suddenly go for the liquidity window and the exit, the managers, and often that's at a time when there's sort of a bit of a downturn, people aren't buying, there's not the liquidity and the underlying property market. But because it's been advertised at the fund level that you can get liquidity, people go, okay, I'm going to get out of here because I think it's going bad in terms of where we are in the cycle.
Christian Rodwell (23:21.294)
but there isn't that liquidity in the fund to meet it. So they end up closing off the liquidity window and people end up getting frustrated. So I think we want to be really clear with our investors and we want like -minded investors to come into these syndicates with the idea that the asset will be sold within sort of seven to 10 years from the time that you commit. During that time period, you can try and trade units.
amongst the other investors in the fund, or we can try and assist with other investors that we have in our network or IFA firms that we work with to try and find liquidity. But really, within your portfolio, this is the core income piece that you are planning to keep for seven to 10 years and keep some other cash, listed equities, bonds, what have you.
keep that in your portfolio so that you have access to liquid assets when you need. Who do you see as your ideal clients? What type of investors would really fit this? Yeah, so I'd say people that have invested in property before are good fits for us. Obviously, you need to have a certain level of wealth. It's not for pure
know, retail investors who want to do small, more like crowdfunding sizes. So our minimum investment size is a hundred thousand pounds, just sort of for high net worth, sophisticated investors. And we always like talking to investors that have an opinion on real estate, believe it or not. if someone sort of hasn't...
got their hands dirty and sort of looked at real estate before, it's hard for us to demonstrate why our particular style of investing is attractive and should be appealing to them because we could kind of be telling them anything and they don't really have the ability to question that and to try and push back and say, well, have you thought of this? Have you thought of that? So actually I enjoy dealing with investors who have invested in
Christian Rodwell (25:43.384)
property before, it can be just a buy to let residential, maybe some kind of commercial in the traditional sectors, or even if they've invested in operational real estate as well. So those kind of investors are great, but at the same time, if someone just wants passive income and they've got an income sort of bucket in their portfolio and they just want to get more yield out of that, they want to squeeze more
monthly payments than what they're getting from the cash fund, money market fund, the bond fund. We can offer that sort of hands -free, you just get that yield every month and you'll get a better yield than what you would have been getting from corporate bonds. So just to kind of clarify, you've touched on certain aspects and you've mentioned, you know,
process, but take us from top to bottom then. So from Sai's perspective, you find the right property and you go in. How's the ownership structure all the way down to the investor? Just quickly take us through that if you don't mind, Sam. Yeah. So that's right. So Patrick and I, we have good relationships with the major brokers and agents in the healthcare space. We also have pretty good relationships with a lot of the operators as well. So we're constantly building that deal pipeline.
We look at a lot of stock and a lot of it's not suitable, not fit for purpose, sort of gets rejected. If we do like something, we'll take it through an initial underwrite, initial due diligence phase, and then we'll start to do more work on that. And eventually we might get that asset under exclusivity. Now at that point, we begin a capital raising process. We might have eight weeks of exclusivity. We go out to our investors and look to raise.
raise capital. Assuming that's successful, we then have a legal due diligence and tax due diligence phase, which takes sort of anywhere from six to eight weeks again. And then we have completion when we sign the sale and purchase agreement and transfer funds. Now, what happens is we have a nominee structure, which is a bear trust. And that's controlled by a large
Christian Rodwell (28:10.04)
global custodian and administrator group. I think they're possibly the largest in the world, if not in the top couple. So they control that nominee. The investor invests into that nominee. Now under that nominee, we have multiple SPVs, which are special purpose vehicles. And they're just a UK limited liability company that's set up entirely to acquire
one property. So that SPV then buys the property, the money then flows from the property, gross rents go up to the SPV, SPV pays some fees and costs and any services, any debt. And then the SPV pushes the money up through the nominee and then the nominee controls the distributions back to the investors. So that's the kind of simple overview. There's a few
little structuring pieces that we use in there as well to make it more financially efficient. But that's the high level picture. Yeah. Yeah. And obviously, I'm sure investors listening now, they're thinking, okay, what about taxes, corporation tax, things like that? there's ways you've even considered that as well, I believe. We want it to be tax efficient without being aggressive in terms of the structuring. So we've done a
a few things within the structure, which are kind well within the bounds of what's acceptable from HMLC's perspective. So one of those is that when the nominee puts money into the SPV, there's sort of two ways that that could happen. One is the nominee could put 100 % equity into the SPV.
And remember the SPV is a UK limited company, so it's subject to CT. So we want to minimize the corporation tax at the SPV level. So instead of putting 100 % equity from the nominee into the SPV, we do a loan agreement between the nominee and the SPV. So some portion of the money is loaned to the SPV, and there'll be a monthly loan repayment.
Christian Rodwell (30:35.896)
from the SPV to the nominee. And then there'll be a slice of equity, which is paid in from the nominee to the SPV. Now the impact of that is that the SPV, which is receiving all these gross rents, which is revenue, and then it's paying a few small costs, management fees and fund administration fees, but it would be left with a substantial tax bill because the gross rents are
significantly more than any of the fees it's paying. So by adding the loan agreement, it means that you're paying interest, which is a tax deductible expense back up to the nominee. And so you've got gross rents, less fees, less the interest that's being paid to the nominee. So it reduces the taxable income for the SPV. And then just the one last real structuring thing that we do is we take that
loan agreement and we'll list it on a channel island exchange, like a Jersey exchange. That's really just a technical listing. And that means that there's, because there's no withholding tax in Jersey, there's no requirement for us to withhold, withholding tax on the interest that's being paid from the SPV to the nominee. So if you're an investor, you invest into the nominee, the nominee then uses your money to do two things.
loan money to the SPV and then put a bit of equity into the SPV as well. And then your return is a combination of the monthly interest on the loan and whatever residual income is available to the equity investors. So from your point of view, you're effectively just getting the net rents from that property, but
it's happening in a more financially efficient structure. you know, of course, as a business owner here, Sam, yourself, there's a degree of recurring income for you as well. So, you know, what does that look like briefly? Yeah, so we charge a fee based on the percentage of the gross rents. So we typically charge somewhere around 7 % of the gross rents. And that covers the asset management,
Christian Rodwell (33:01.302)
investment management and property management. So we do all of that for that percentage of the rents. And for healthcare, because it's an operational asset, there is quite a lot of work for the asset manager to do. So the real risk is that the operator of your property doesn't operate that care home or that dentist or that GP according to the
regulations. So you have the Care Quality Commission, which is the regulator in the UK, and they have sort of the power, if you like, to shut down that care home or shut down that dentist if they're not following the policies and procedures that they need to have. Now you will get some warning from the CQC. They won't just walk in and say, you're closed. They will say, you need to improve XYZ.
And so we have a close relationship with the operators and we're constantly monitoring XYZ before the CQC comes in. And we often pay third party external consultants to come in and do a review of the tenant or the operator and say, hey, they're in terms of, I don't know what it would be in a care home, policies around giving medicine to the residents.
or cleaning or having enough staff per resident. These are all sort of set things that you should do at a bare minimum. So we as the landlord, as the property owner, we want to know that our tenants are operating the business well, because if they have a well -run profitable business, we're going to have good security over our rent.
And that's ultimately what we want. We want our tenants to be running a profitable business in our property. And finally, Sam, for anyone listening now who likes the sound of what we've been talking about today, the different ways that people can invest, of course, they've got cash, then that could be one way, but also with pension money. So just talk us briefly through how that might work. So a lot of our investors will hold this in their sip.
Christian Rodwell (35:25.09)
I would say there are a few SIP trustees which may push back on ownership of commercial property either directly or via a syndication, but usually you would be allowed to hold this in your SIP. For sure you're allowed to hold it in your SaaS if you have a SaaS. And that's a really tax efficient way to own this.
to be honest, because within the actual syndication, we try and minimize the corporation tax that's paid at SPV level. And then when you invest via your SIP or your SAS into the nominee, you will pay taxes as per the requirement for that entity investing into the nominee. So if it's a SIP or a SAS, then there's no taxes during the life of that investment.
Obviously, when you go to withdraw that, there'll be some tax implications. But those are particularly efficient ways of investing into this. Unfortunately, you can't invest via your ISA, but I think the SIP or the SAS are great vehicles for tax -efficient investing. It's been great speaking with you, Sam. Thanks so much for coming on to World for Talk today and sharing about your business. And if someone would like to find out more, get in touch.
the best place for them to head? Yeah, sure. So go to our website, which is www .sirecp .co .uk. And we have some contact details there. We have a current offers page and feel free to browse through that. then my contact details are on there. So Patrick, I'm happy to chat with anyone who thinks this might be interesting. Thanks, Sam. Thanks for being a great guest on Wealth Talk today. Thanks, Christian. Thanks for having me. Appreciate it.
Christian Rodwell (37:25.55)
Okay, so thanks to Sam there for sharing a lot of detail about how his business works. And we'll pull out some of those wealth lessons in a second, Kevin, but we've got a review as always and going to switch it up this week, head over to iTunes because of course, many of our listeners listen to the podcast via the Apple platform.
And Spotify is rapidly on the increase. I can see that from the stats and the downloads, but we've got a review on iTunes. comes in from, well, just as LAU as the username. They say engaging and insightful times are changing and we really need a leverage to stay in the game, especially for us in the property business. I can't wait to share the practical knowledge within my circle. Keep up the good work guys. nice. Another person who's interested in property.
And of course, as Sam shared with us today, operational real estate, we've not heard those words kind of scroll together in a sentence before. Operational real estate. Well, what we basically mean by that is property in which some kind of business activity is taking place. And that's obvious in commercial property, shops, offices, that kind of thing, storage units. think we've covered all of those at some level on the podcast, people who've chosen.
those niches in property. It's interesting though that Sam and his business owner colleague have really focused on the kind of medical related things really. doctors and dentists, you get that and you can see there's increasing demand for GP practices and for dentists who are creating not just a sort of a single chair but multiple chairs and there's a whole
kind of way valuing the chairs in a dentist practice, then into, and so we all need doctors and dentists, right? So that's kind of not really age related, but then he talked, he, about retirement villages and that's on the increases in the UK. We know it's big in other parts of the world, but we're definitely seeing it here in the UK. Big demand for that as people kind of reach a certain crossroads in their life when their lifestyle's changing.
Christian Rodwell (39:45.292)
new chapter almost really. And then I suppose the final chapter, is, you know, when, when people are in care homes, know, the staying in the home often because they need to, as opposed to staying in their own home and having care. And when that happens, then there's a big demand for that. And as we know, certainly not inexpensive and lots of people talking about the cost of care homes and you know, on average people
people in the UK, Chris, and in the States, they do stay a reasonable length of time in these homes, know. It's typically around 20 months to 30 months, so a couple of years. Sometimes, unfortunately, people don't stay there too long. And I think some people can go on for years. think your mom was in one for how long? 10 years, she was, yeah. Wow. I mean, that's a heck of a long time.
You know everyone by then But you know, there's value in understanding that there's a link between people's medical conditions as in the doctors and dentists and the care homes, but also in terms of this Baby boomers, particularly. I'm a baby boomer can be a tsunami of money Flowing between the baby boomers and the next generation and the kids definitely don't want that money to be all gone on
on care fees. So we know that there are special ways that you can actually buy the care in advance. You you can pay a lump sum to sort of de -risk the 10 years in a care home. Now, would be, if you imagine that was a 50, 60 grand a year shortfall from the pension that somebody might be bringing to the table, you're talking about half a million quid plus inflation. You know, it could be talking about a million pounds worth of
assets that get lost to the next generation. there's definitely demand for not just the care homes, but also the different ways to fund them. indeed, Sai was all about ways of funding property. So an interesting model, I thought. Yes, and we've showcased many different ways to invest in property, to acquire property. It's important for us to emphasize, Kevin, we never promote any particular investment and
Christian Rodwell (42:10.862)
Neither are we doing that today. you know, we want to showcase businesses and interesting models and obviously let our listeners make their own decision and due diligence, a key part of that with, of course, any aspect of wealth building. Thanks for saying that. And I think well said. We're not in the business of promoting investments of any kind, not at all. But we love the idea of sharing knowledge. And yes, due diligence is a critical part and we teach
due diligence is part of that process in the wheel of wealth, don't we? Where the final stage before making any decision is the due diligence stage. In other words, looking at all the risks that you could be encountering, documenting those risks, and then deciding how you are mitigating that risks or those risks, or indeed accepting them. And this is true in life, you know, when you see a risk as a risk in anything, there's no...
investment, there's no wealth building pillar that is risk free. Everything is risky, including holding cash because the risk of inflation, liquidity, if the banks go bust, you know, the drill on this. But as soon as you get into the due diligence piece, there's the risk and everything. When you document it, you've got three reactions. can first of all, but once you understand the risk and that's point before everything is you can either accept the risk and say, well, I understand the risk.
or risks, I accept them. Or I partly get the risk, but I want to cover myself against something else so that diversifying, for example, would be a key thing so you don't put all your eggs in one basket, you don't become a diver, which we talked about when we talked about investing in a recent podcast, maybe signpost that one. Maybe even signpost the Wheel of Wealth, Chris, that'd be a pick.
a pictogram of that or an infographic on that. Or you just say that's too big a risk and either don't do it or fully protect yourself, which is often the case with things like young families. Don't take the risk with your family. Get your will done. Get your life cover and trust. But if it comes to investing, it's that's too big a risk for where I want to be. That's not something for me. And we don't get involved in someone's risk. That's their call and their unique call. And this is just an interesting.
Christian Rodwell (44:36.578)
set of risks here, but with a model that's definitely you can understand it. You can understand the principles behind it and why some in particular is very excited about trying to bring the way that model works to a wider audience and that I get. And any good business identifies a problem and aims to solve it. And we touched on the problem of the aging population and a lack of good quality care for them.
The other problem as well that he talked about was the defined benefit pension schemes that they're winding down now. And there's more and more business owners who are wishing to take control of their own money. But they don't necessarily have the millions of pounds required to get these types of properties that Sam was talking about. you know, perhaps with your expertise in the area of pensions, Kevin, any words there about, you know, how an investor of a pension could work really well with this as well? Well, as we know,
Pensions and property can work really well. Pensions and business can work well. Pensions and intellectual property can work well. And pensions and joint ventures can work well. When it comes to owning this kind of real estate, this kind of property, whether you're buying a premises to rent to a doctor or a firm of dentists or a pharmacy, whether you're buying a care home for somebody else to operate in it, or whether you're buying into
I suppose the business of providing retirement villages, I've not got any experience of that, not seen that yet. But I've definitely seen care homes, children's homes, care plus accommodation. I've seen that easily funded by people who've got pensions that were outside of their control, I guess, really exclusively on the stock market. So they weren't able to direct that very well.
they can use that for property. So for those people who love property and have got the willingness to take control of their pension and a few other factors as well, then there are pensions that can do that. And we've covered that on many, many occasions, haven't we, with the concept of that interesting word called SAS or the Small Self -Administered Scheme, basically a pension scheme for a director of company or directors who want to be in the driving seat of their pension as opposed to...
Christian Rodwell (46:59.166)
the passenger seat and let somebody else drive the vehicle for them. yeah, we're definitely seeing that and I'm sure the people at Sire will see the opportunity to speak with people who either got SAS's or who might be open -minded to doing that. So I wish them well with their business. It's a very interesting model. Yeah. And if that's a new concept to you, use my pension.
Use it now before 1 .55, which is absolutely possible for the right people. Then do click on the show notes. I'll put a link to a previous episode that we recorded called, What is a SaaS Pension? And you can get in touch with us. That's something that we do every day. And our team would be more than happy to have a chat and see if that's something that might be applicable for you. you can book a call with our team and just chat to us about anything really in terms of your wealth, if you want to see.
how you can make your current assets work harder or to find out a bit more about what we do with our members inside of Wealth Builders. Just head to the Wealth Builders website, wealthbuilders .co .uk forward slash discovery call and you'll see a whole list of different times where you can book in and have a chat with our team. Yeah, thanks for that Chris. And we get a lot of calls every week. So always happy if more people got a question or a challenge for us to, cause people get overwhelmed, right? I mean, look, every podcast we're bringing new ideas.
that somebody else has found a problem, found a solution and there needs to be some knowledge and preparation and risks associated with that. And you couldn't master all of them. mean, we've 250 podcast. If you imagine somebody trying to learn 250 strategies to build wealth, they'll topple over because their brain would be too full. They wouldn't be able to execute. So it's just good to listen, get your own gray matter challenging that thinking.
What do I like about that? What do I not like about that in any asset? Not in particular this one, but just to see if you can understand it and then decide what's your DNA, who are you, what are you most fascinated and interested in? And I'm sure there'll be many people who are active in the medical industry who might be curious about that because they understand the practicalities of
Christian Rodwell (49:20.366)
what being a doctor is, what being a dentist is, what being a chiropractor or a hands -on physiotherapist and the like, the list could go on. But as you start to see that there's a clear link, isn't there, as Sam ably demonstrated, that we talk about the dentist. The dentist isn't going to be able to sell that business if they relocate 50 miles away because they have to start all over again. So it's an interesting model.
I think there's definitely some growth and even in my own village where I live, there's a new one of these being established, taken over from an old commercial property. It's kind of like a private GP practice and you're seeing them pop up all over the place now. So just an interesting one to recognize if you see yourself and go, yeah, I heard about that on WellTalk.
Well, we hope you enjoyed today's episode. As always, if you did and you think somebody else might gain some value from listening, hit the share button on your podcasting app right now. Send it to them. And Kevin, you and I will be back same time, same place next week. Yes, we will, Chris. And until then, my friend, see you.
Christian Rodwell (50:34.2)
We hope you enjoy today's episode. Don't forget that we are constantly updating our resources inside the WealthBuilders membership site to help you create, build and protect your wealth. Head over to wealthbuilders .co .uk slash membership right now for free access. That's wealthbuilders .co .uk slash membership.