Xafinity Sipp and Ssas, part of pensions specialist Xafinity Group, has reported a 20 per cent increase in commercial property purchases in pensions.
According to the firm, more than 170 commercial property and land purchases or transfers into pensions were completed in 2016.
This was a 20 per cent rise in 2016 compared to 2015, and the total value of these properties was £45m, a 10 per cent increase from 2015.
Property and land purchase prices ranged from £40,000 for small retail properties and plots of land earmarked for development to large industrial properties valued over £1.5m.
In August last year, Xafinity extended its the deadline of its property transfer offer to advisers.
According to the provider, this was in light of the recent self-invested personal pension and small self-administered scheme consolidation activity in the market.
Jeff Steedman, head of business development for Sipp and Ssas said: “Directors of small and medium enterprise companies and smaller retailers continue to use their existing pension plans to self invest into their business.
"Putting property into pensions remains an excellent tax efficient way for SMEs to grow their pension funds for retirement. The rental income alone can provide excellent growth for their pensions.
"There is significant potential growth in the Sipp and Ssas property space but the Sipp and Ssas providers and financial advisers do need to work together to educate business owners and their accountants about opportunities.”
Colin Rodger, director at Edinburgh and Glasgow-based Alexander Sloan Financial Planning said: "Although the stock market had a good run at the end of the year, 2016 was a very unsettled year and it could be that property was seen as a relatively steady option.
"Also, in a low interest rate environment rental income gives a good return, particularly if it is the member’s own business paying the rent."
ruth.gillbe@ft.com
