A New Way To Invest In Commercial Property
Discover the benefits of pooling resources to access institutional- grade property in a Single Asset Fund.
The commercial property investment sector in the United Kingdom is undergoing a profound transformation, driven by artificial intelligence technologies that are reshaping how high-net-worth individuals access and evaluate investment opportunities. This technological revolution is creating unprecedented advantages for investors who utilise Single Asset Funds (SAFs) as vehicles to gain exposure to institutional-grade commercial properties, particularly in the healthcare sector.
As economic confidence among UK’s wealthy investors continues to decline—dropping from 84% in August 2024 to just 48% in January 2025 according to the Saltus Wealth Index Report [1]—the need for stable, transparent investment vehicles has never been more pressing. This article examines how the convergence of AI technology and Single Asset Funds is creating compelling opportunities for HNWIs seeking to preserve and grow wealth through commercial property investments.
Artificial intelligence has fundamentally altered the commercial property investment sector by enhancing predictive analytics and decision-making processes. Commercial real estate brokers are increasingly using generative AI to enhance their workflows and improve the quality and speed of their services. The most popular AI platform, Perplexity, is gaining traction among commercial brokers for its ability to search the web in real time while answering their questions [16].
Beyond basic search capabilities, some industry professionals are developing custom AI solutions. For example, Raphael Collazo, president and co-founder of Summit Commercial Group, created a custom Generative Pre-trained Transformer trained on his own books to mimic his voice and perform property analysis [16]. This level of customisation demonstrates how AI is being tailored to specific commercial property applications.
The impact of AI on commercial real estate operations is substantial and measurable. AI-driven tools can reduce operational costs in commercial real estate by up to 25%, optimize energy consumption in commercial buildings by up to 20%, and reduce maintenance costs by up to 30% [20]. These efficiency gains translate directly to improved returns for property investors, making AI integration a critical consideration for forward-thinking investment vehicles.
“Commercial real estate brokers are increasingly using generative AI to enhance their workflows and improve the quality and speed of their services… The most popular AI platform, Perplexity, is also popular among commercial brokers for its ability to search the web in real time while answering their questions,” reports Commercial Search [16].
For high-net-worth individuals, this technological revolution means access to investment opportunities previously identified only by institutional investors with substantial research departments. Single Asset Funds that incorporate AI-driven analytics can offer HNWIs entry into premium commercial property investments with enhanced due diligence and risk assessment.
The current tax environment in the UK has prompted significant wealth migration, with approximately 9,500 HNWIs forecasted to leave the UK in 2024, with 68% relocating to European countries such as Italy, Malta, and Greece [4]. This exodus underscores the critical importance of tax-efficient investment structures for those who remain or maintain UK investments.
Single Asset Funds offer structural advantages in this climate through clear ownership structures, transparent fee arrangements, and potentially more favourable tax treatment compared to some collective investment schemes. Unlike traditional property funds that pool investor capital across multiple assets, SAFs provide direct ownership of specific properties, offering greater control and transparency.
This structure aligns with the evolving needs of HNWIs seeking to optimise their investment strategies in response to tax policy changes. The transparency inherent in Single Asset Funds allows investors to clearly understand the tax implications of their investments and make informed decisions accordingly.
While each investor’s tax situation is unique, SAFs typically provide clearer visibility into income streams and capital gains, potentially allowing for more effective tax planning. Additionally, the direct ownership structure may offer opportunities for inheritance tax planning that aren’t available through more opaque collective investment vehicles.
Despite economic uncertainties, HNWIs continue to demonstrate strong interest in UK property investments. A recent survey by Investec revealed that 77% of HNWIs plan to increase their UK property investments, with an average additional investment of £380,000 [5]. This significant capital inflow creates opportunities for investment vehicles that can efficiently deploy these funds into institutional-grade assets.
What’s driving this optimism among high-net-worth investors? According to Investec’s latest research, 72% of HNWIs express a positive outlook on the UK property market [17]. This survey, which gathered insights from wealthy property investors across the UK, found that despite broader economic concerns, confidence in property as an asset class remains robust. Factors contributing to this optimism include the stabilisation of interest rates, the resilience of prime property values, and the long-term growth potential of strategic locations.
Single Asset Funds excel in this environment by enabling HNWIs to access commercial properties that would typically be beyond the reach of individual investors. By aggregating capital from multiple investors, SAFs can acquire prime commercial assets that offer attractive yields and long-term appreciation potential.
This approach addresses one of the key challenges faced by HNWIs: difficulty accessing institutional-grade commercial properties due to high capital requirements and limited individual investment capacity. A case study from Hardington Capital illustrates this advantage, where they acquired a regional HQ office in Birmingham for £13,500,000, achieving a running yield of 10.65% and a projected IRR of 10%+. Similarly, they purchased a city office in London for £6,750,000, projecting a yield of 14% and an IRR of 20%+ [14]. These institutional-grade properties would be inaccessible to most individual investors without the aggregated capital structure of a Single Asset Fund.
The healthcare sector represents a particularly compelling opportunity within commercial property. Healthcare facilities typically feature long-term leases with government-backed or highly regulated tenants, providing stable, inflation-linked income streams that are less correlated with economic downturns than other commercial property sectors. SIRE Capital Partners specialises in this approach, offering Single Asset Funds that focus exclusively on healthcare real estate. By combining AI-driven analytics with sector-specific expertise, SIRE enables HNWIs to co-invest in institutional-grade healthcare properties that deliver secure, inflation-linked income [15].
One of the most significant advantages AI brings to commercial property investment is enhanced due diligence capabilities. Traditional property assessment often relies on limited data points and human judgment, which can introduce biases and oversights. AI-powered due diligence processes transform risk assessment by analysing comprehensive datasets to identify potential issues and opportunities.
The impact of AI on property valuation accuracy is substantial. AI can increase property appraisal accuracy by up to 30% and reduce errors in property valuation models by up to 30% [21]. Even more impressively, real estate companies using AI-powered data analytics have reported a 65% increase in decision-making accuracy [22]. These improvements in valuation precision and decision-making quality directly translate to reduced investment risk and enhanced returns.
For Single Asset Funds, this technological capability represents a competitive advantage in identifying and securing high-quality assets. The integration of AI into commercial real estate is evolving beyond basic applications to include conversational interfaces that allow facility managers to query faults or performance issues in real time and receive updates on building performance across portfolios [16]. These tools are evolving beyond simply providing answers to supporting decision-making, creating powerful new platforms that offer enhanced capabilities for property assessment and management.
The real-world impact of AI-enhanced due diligence is demonstrated by Assetbrook LLP’s work with a British high-net-worth individual with an extensive UK real estate portfolio. By conducting a comprehensive AI-driven audit of the client’s portfolio, evaluating property performance, and developing an optimization strategy, they achieved remarkable results: a 12% increase in rental income, 15% reduction in operational costs, and 8% average property appreciation within the first year [9]. This case study illustrates how AI-enhanced due diligence can deliver measurable improvements in portfolio performance.
The technology is particularly valuable in specialised sectors like life sciences, where AI can help identify emerging opportunities in cutting-edge facilities such as Europe’s first vertical life sciences campus [6].
For HNWIs seeking transparent investment vehicles, AI-enhanced due diligence provides greater confidence in the quality and potential performance of underlying assets. This transparency addresses a key concern for sophisticated investors who demand clear visibility into their investments.
"AI-powered valuation tools have been shown to increase valuation accuracy by up to 30%, providing investors with greater confidence in their investment decisions." - JLL, 2023
The sharp decline in economic confidence among HNWIs across all UK regions signals a growing need for investment vehicles that can provide inflation protection and wealth preservation. Commercial property, particularly with long-term leases featuring inflation-linked rent reviews, can offer this protection during periods of economic uncertainty.
Single Asset Funds that focus on commercial properties with these characteristics provide HNWIs with a transparent vehicle to access inflation-hedging assets. Healthcare properties are particularly well-suited to this purpose, as they typically feature:
These features create a compelling inflation hedge that can help preserve wealth during periods of economic volatility. By providing direct ownership of these assets through a transparent fund structure, SAFs offer HNWIs both inflation protection and potential capital appreciation.
A practical example of this approach can be seen in Hardington Capital’s acquisition of a supermarket in Manchester for £3,950,000, which achieved a running yield of 7.53% with a reversionary yield of 8.42% by June 2026, offering a potential IRR of 15%+ [14]. This type of investment, with its essential retail tenant and inflation-linked lease structure, exemplifies how Single Asset Funds can provide both income stability and inflation protection in uncertain economic conditions.
Healthcare properties typically outperform other commercial sectors during inflationary periods due to their long-term, inflation-linked leases and essential service nature. Unlike retail or office properties, which may experience reduced demand during economic downturns, healthcare facilities typically maintain stable occupancy and income streams regardless of broader economic conditions.
The commercial property investment sector continues to evolve, with traditional structures like Real Estate Investment Trusts (REITs) facing challenges and new models emerging. A recent example of this evolution is Supermarket Income REIT’s announcement of plans to move from a closed-ended investment fund to equity shares as a commercial company, a shift expected to save the company £4 million annually in operating costs [7].
This structural shift highlights the potential advantages of alternative investment vehicles like Single Asset Funds compared to traditional REITs:
| Feature | Traditional REITs | Single Asset Funds |
|---|---|---|
| Asset Transparency | Portfolio of multiple properties, often with limited visibility into individual asset performance | Single, clearly identified property with full transparency into asset performance |
| Investment Control | Limited investor control over property selection, management decisions, or exit timing | Greater investor input on property selection, management approach, and potential exit strategies |
| Fee Structure | Multiple layers of fees including management, performance, and administrative costs | Typically simpler fee structures with fewer layers and greater transparency |
| Liquidity | Publicly traded with daily liquidity but subject to market sentiment and potential discount to NAV | Less liquid but potentially closer alignment between investment value and underlying asset value |
| Investment Focus | Broad mandate across multiple properties and potentially multiple sectors | Focused investment in a single, carefully selected property |
For HNWIs seeking efficient exposure to commercial property, SAFs represent a compelling alternative to traditional REITs. By eliminating blind pool risk and providing clear visibility into underlying assets, these vehicles address many of the concerns that have prompted structural changes in the broader property investment market.
Recent market developments further illustrate this trend. American Homes 4 Rent (AMH), a leading real estate investment trust, recently released its ‘Investor Highlights’ presentation detailing its strategic initiatives and financial outlook. The company reported strong financial health with a high-quality investment-grade balance sheet and significant undrawn credit capacity, highlighting favorable market conditions including a shortage of single-family homes and a growing renter cohort [16]. This example demonstrates how even traditional REITs are adapting to changing market conditions and investor preferences.
Environmental, Social, and Governance (ESG) considerations are increasingly important to HNWIs, with the Knight Frank Wealth Report 2025 forecasting a continued shift towards sustainable investments in the real estate sector [8]. AI technologies are enabling more sophisticated ESG analysis in commercial property investments, allowing Single Asset Funds to identify sustainable properties that align with investors’ values while potentially offering enhanced long-term returns.
“The Knight Frank Wealth Report 2025 indicates a growing focus on sustainable investments, with 42% of investors prioritizing social impact in their real estate ventures,” notes the latest research [8]. This significant percentage demonstrates the increasing importance of ESG factors in investment decision-making among HNWIs.
A concrete example of AI application in ESG assessment is Socialsuite’s recent launch of an AI-powered double materiality assessment solution. This software platform assists companies in managing double materiality assessments required under new sustainability reporting regulations. The solution combines AI-powered benchmarking with intelligent analysis to align with compliance requirements under the CSRD’s European Sustainability Reporting Standards (ESRS) and the ISSB standards [16].
The platform includes centralized stakeholder engagement, materiality data, and documentation, along with intelligent benchmarking to identify industry trends, assess impacts, risks, and opportunities, and guide strategic decision-making [16]. For Single Asset Funds focused on commercial property, such tools provide a systematic approach to evaluating the ESG credentials of potential investments, helping fund managers identify properties that not only meet financial criteria but also align with increasingly important sustainability standards.
The integration of ESG considerations is becoming a dominant factor in client conversations. By 2025, stricter measures to combat greenwashing are expected, pushing asset managers to provide clearer, more measurable impact metrics. This shift highlights the growing demand for purpose-driven wealth management that aligns investments with personal and global impact [13].
Single Asset Funds that leverage AI for ESG integration can offer HNWIs access to properties that not only meet their financial objectives but also align with their values. This alignment is increasingly important as wealthy investors seek to ensure their investments reflect their personal principles and contribute positively to society.
Looking ahead to 2025, the UK is projected to spearhead the global real estate sector’s recovery, bolstered by economic stability and capital value gains. M&G Real Estate’s Global Real Estate Outlook highlights the UK’s emergence from uncertainty with renewed economic momentum, presenting attractive opportunities for increased real estate allocations [19].
This positive outlook for the UK market creates a strategic opportunity for Single Asset Funds focused on healthcare properties. With their long-term, government-backed leases ensuring stable, inflation-linked income streams, these investments are well-positioned to benefit from the broader market recovery while maintaining their defensive characteristics.
Recent developments in the healthcare REIT sector illustrate both the opportunities and challenges in this space. HealthCo Healthcare & Wellness REIT and the Unlisted Healthcare Fund have recently agreed to a short-term partial rent deferral with Healthscope and its Receivers to ensure the continuity of services at 11 private hospitals. The agreement includes immediate payment of outstanding rents for March and April 2025, 85% of rent for May 2025, with the remaining 15% deferred until September 2025 [16]. This situation highlights the importance of careful tenant selection and robust due diligence in healthcare property investments.
For HNWIs considering commercial property investments, this projected recovery suggests that strategic entry into the market through vehicles like Single Asset Funds could provide both immediate income stability and potential capital appreciation as the market strengthens. The combination of AI-enhanced due diligence and the structural advantages of SAFs creates a compelling proposition for investors seeking to capitalize on the UK’s leading position in the global real estate recovery.
"AI-powered predictive analytics can help investors identify potential opportunities and risks in the market by analysing large volumes of data." - BDO
Investors in healthcare property through Single Asset Funds should be aware of upcoming regulatory changes that could impact their investments. The 2025 Audit Regulations, set to come into effect on 1 June 2025, introduce new requirements that could affect property investment structures. These regulations include a requirement for ICAEW-registered audit firms to notify ICAEW when they are appointed to certain complex or high-risk audits [16].
Of particular relevance to Single Asset Funds investing in healthcare properties is the notification requirement for audits of entities with turnover greater than £750 million, or which are classified as Other Entities of Public Interest under the FRC Ethical Standard. The regulations also introduce a new requirement for sole practice auditors to appoint an alternate who can intervene when a sole practitioner is unable to practice due to illness [16].
These regulatory changes aim to provide increased regulator visibility of certain high-risk audits, which could include healthcare properties with significant turnover or public interest implications. For Single Asset Funds, this means potentially enhanced scrutiny of financial reporting and audit processes, particularly for larger healthcare facilities or those providing essential public services.
Understanding and preparing for these regulatory developments is essential for fund managers and investors in the healthcare property sector. By staying ahead of regulatory changes, Single Asset Funds can ensure compliance while maintaining the transparency and governance standards that HNWIs increasingly demand from their investments.
The integration of artificial intelligence into commercial property investment represents a significant opportunity for high-net-worth individuals seeking stable, transparent investment vehicles in an uncertain economic environment. By leveraging AI-enhanced analytics and due diligence processes, Single Asset Funds can identify prime commercial properties with greater precision and reduced risk.
For HNWIs concerned about inflation, tax efficiency, and portfolio diversification, SAFs focused on healthcare real estate offer a compelling solution. These vehicles provide direct access to institutional-grade properties with long-term, inflation-linked income streams, addressing key wealth preservation concerns while offering potential for capital appreciation.
As we look toward 2025 and beyond, several practical recommendations emerge for HNWIs considering commercial property investments:
As the AI revolution continues to transform the commercial property sector, investors who embrace these technological advancements through vehicles like Single Asset Funds will be well-positioned to achieve their financial objectives. By combining the transparency and control of direct property ownership with the analytical power of artificial intelligence, these investment vehicles represent the future of commercial property investment for sophisticated investors.
We observe a clear trend among sophisticated investors seeking greater control and transparency in their property allocations, particularly in light of economic shifts. This reinforces our conviction in the Single Asset Fund structure. We believe this approach offers unparalleled clarity over the underlying asset and its performance, a critical factor for high-net-worth individuals. Furthermore, we see technologies like artificial intelligence as powerful tools that enhance our ability to conduct precise due diligence and asset analysis, complementing our expertise to identify and secure institutional-grade properties that meet our stringent criteria.
Our exclusive focus on healthcare real estate stems from its inherent defensive qualities – long-term, inflation-linked leases and essential service tenants provide a stability that is difficult to replicate. We are confident in the sector’s resilience and its potential to deliver secure, inflation-linked income streams. Navigating market dynamics and regulatory requirements demands rigorous processes, and we are committed to maintaining the highest standards of transparency and governance to ensure our investors have full confidence in their co-investments with us.
Patrick Ryan is a Principal and Co-founder at SIRE Capital Partners, working on Deal Origination and Asset Management. Patrick has spent 20 years in the property sector in London. His first foray into the sector was in 2003 when he co-founded a mezzanine finance business that focused on lending to property developers in and around London. Following this he headed up SIRE Properties, a healthcare focused asset management firm. Patrick has now co-founded SIRE Capital Partners that has expanded on his healthcare asset management focus to take in broader services to include brokerage and capital advisory.
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