Ep. 108: Building wealth through commercial property, with Helen Tarrant

In this episode of the Geared for Growth podcast, Mike teams up with Helen Tarrant, a seasoned commercial buyer’s agent and the visionary behind Unikorn Commercial Property, to delve into the intricacies and benefits of investing in commercial real estate.

As one of the pioneering buyer’s agents in the commercial property sector, Helen has amassed significant success in constructing her own portfolio. Recognizing the common challenge faced by novice investors in navigating the commercial property landscape—namely, identifying suitable properties and comprehending their return potential—Helen established Unikorn with the aim of guiding everyday investors through their commercial property investment journey.

Mike and Helen delve into the essentials of entering the commercial property market, weighing the pros and cons of starting with residential properties first and identifying the key barriers to entry. Mike probes into the minimum income threshold required for investors, uncovering unexpected and encouraging insights from Helen. Through relatable examples, Helen sheds light on how banks assess lending risk and how this assessment varies based on different leasing scenarios.

The discussion also delves into the critical aspect of risk management, with Helen highlighting the importance of implementing the appropriate strategy tailored to each property. Furthermore, Helen offers valuable insights into conducting due diligence in commercial property transactions, emphasizing the distinct differences compared to residential properties, particularly regarding the obligations outlined in leases for both landlords and tenants.

The conversation extends to the crucial consideration of balancing capital growth with cash flow, with Helen attributing the misconception that commercial property is solely focused on yield to a lack of transparency within the industry. This dialogue provides captivating insights into a sector that often remains less understood than its residential counterpart yet holds considerable potential for investors.

Here at MCG, we are passionate about creating a forum and education series for property owners and investors. We do depreciation differently, and offer a set rate for Replacement Cost Estimate reports. A first in the industry. Join our clients saving more on their tax today https://www.mcgqs.com.au/

 

Follow Helen Tarrant

www.helentarrant.com

 

In this episode of the Geared for Growth podcast, Mike teams up with Helen Tarrant, a seasoned commercial buyer’s agent and the visionary behind Unikorn Commercial Property, to delve into the intricacies and benefits of investing in commercial real estate.

https://youtu.be/mDUSXP_euL0

• Helen’s focus on commercial property
• Do investors need a residential portfolio before getting started in commercial?
• Is there a minimum income requirement?
• How banks assess borrowing capacity for commercial investments
• Understanding value and an investor’s future strategy
• Capital growth vs yields in the commercial sector
• What due diligence looks like for a commercial property
• Helen’s top three tups for investing in commercial assets

“The stumbling block for investors has been that everything looks so good but which one is actually the right one right that’s the number one. The number two thing then becomes how do I even know this return is actually good for this property” 1:27

“The bank is going to look at that property and go you still have to show me how you’re gonna service this property if tomorrow morning your tenant happens to break lease because we know that that property will then take 12 months maybe even 18 months to fill” 6:37

“I think the thing is about value for me. Everything I look at when I find a property for a client, I look at value and I look at their ultimate future strategy” 11:00

“The main problem with commercial property is lack of transparency. That’s why people don’t believe (capital growth) is possible” 18:04

“The thing about capital growth in commercial property is that so few people in the market actually understand it and very much they’re superficial. There’s a lot of people that are buyer’s agents that came from the residential space and they don’t understand commercial property capital growth” 20:50

“The number one thing is to acknowledge and realise that residential is different from commercial. Firstly understanding commercial plays it’s own game and it’s its own beast, organism, you need to learn the rules of the game” 28:36

“Our clients get their results because they know from day one if they buy this property they will achieve their results in 2-3-5 years” 31:18

Links mentioned:

https://unikorn.com.au/

Are you a fan of The Geared for Growth podcast? If the ideas and tips we share in each episode are inspiring you to become a more knowledgeable property investor, subscribe to the show and leave your honest review to let us know!