“We're not focusing on the short term”
PETER VOLPé
SCOTIA WEALTH MANAGEMENT
“Private real estate can offer protection against emotional public market forces – with less volatility, low correlation to other asset classes, improved returns with less downside risk, and consistency of returns. It’s also a hedge against inflation”
lavelle lindo, equiton
“Our expectation is that we’re in the early stages of a bull market and this market is going to roar”
Daniel Sacke,
BMO Nesbitt Burns
In Partnership with
Real estate delivers value for ultra-high-net-worth clients
Experts share top value-add strategies and thoughts on real estate opportunities for wealthy clients
Read on
WITH THE economy flirting with a recession and central banks keeping people guessing about the next move for interest rates, many ultra-high-net-worth investors are looking to their advisors for answers.
Should they be focusing on preservation of wealth? Are there opportunities to generate attractive returns? Advisors are facing these questions and more as they help their wealthier clients navigate continued volatility in the markets.
Beyond yield, there are some opportunities with companies that are increasing their dividends. And while the rocky real estate market has scared off some investors, there are exceptions, such as the Equiton Apartment Fund, which has been generating very consistent returns. The Fund is open to all investor classes making it possible for all Canadians to invest in institutional-grade private real estate investments earlier restricted to institutional investors and high-net-worth individuals.
“One of the popular analogies we share is to skate to where the puck is going to be, not where it is,” says Lindo from Equiton. “It’s what I like most about Equiton’s value-add strategy. In the Equiton Apartment Fund you have a real income solution for investors that generated over a 15 percent net calendar return in 2022, partly by turning over or renovating 439 units, which led to a rental increase of 20.3 percent across the portfolio and added $45 million of value to the Fund.
Kicking the discussion off, host Burton asked the participants what strategies they’re deploying in the face of persistent inflation. While some cited higher rates to generate yield, others noted the benefit of tax-friendly investments and attractive dividends.
“It’s a really challenging time in the markets where we have inflation and higher interest rates, but the real rates of return are negative,” says Maggio of Scotia Wealth Management. “Typically, we would look at large-cap businesses and dividend payers, but given where inflation is, we’re focusing on bank structured notes that provide exceptional interest rates far above GICs.”
It’s a strategy that draws agreement from other participants. Scotia’s Volpé also cited the need to pay close attention to duration as inflation and rates recede from their highs over the next year or two.
“We’re not focusing on the short term,” he explains. “We try to look at portfolio construction over the next 36 months or so as we see further declines in inflation and interest rates.”
A key characteristic of ultra-high-net-worth clients is that they are already wealthy. Unlike other investors who may be focused on increasing wealth, these are investors who are primarily looking to preserve the wealth they have already acquired.
“Most of these people have taken a considerable amount of risk to get to where they are,” Garlock from TD Wealth says. “I personally focus on wealth preservation, minimizing the downside, and that to me trumps earning high returns. Tax efficiency is also incredibly important.” Garlock adds that
many business owners aren’t aware they can take money out of their corporation on a tax-free basis from time to time.
Equiton’s Lindo agrees, citing the tax benefits of his firm’s Apartment Fund. “Equiton has a 100 percent return of capital distribution, so that’s very advantageous to investors in corporate or cash accounts,” he says. “Investors can use registered accounts to invest in our Funds offering them a diversified portfolio and growth over time without any complicated accounting or taxation concerns.”
BMO’s Sacke agrees with the need to focus on wealth preservation and tax efficiency. He says this breaks down into three important variables: liquidity, cash flow, and taxation.
But, Garlock explains, they’re all vastly different asset classes, with apartment buildings in particular benefitting from record rents at the same time the value of apartment buildings continues to rise.
Lindo says apartments provide an attractive buffer against market volatility and offer wealthy clients the capital protection they need. “Private real estate can offer protection against emotional public market forces – with less volatility, low correlation to other asset classes, improved returns with less downside risk, and consistency of returns. It’s also a hedge against inflation.”
As inflation cools and interest rates near their peak, investors are seeking new opportunities as the markets adjust. For Volpé it’s an opportunity to take advantage of higher yields as well as mispricing in some sectors.
“But we’re maintaining a balanced approach,” he adds. “We’re probably neutral on equities, probably net around that 60 percent range, but less than five percent cash, and maybe about 15 percent targeted for the liquid alternatives. And the remaining portion would be in the traditional fixed income, where we’re getting internal yields of in excess of six percent.
Sacke is feeling optimistic about where the market goes from here, citing resilient prices in oil and metals as signs of demand in the economy.
“Our expectation is that we’re in the early stages of a bull market and this market is going to roar for a number of reasons,” Sacke explains.
“There is a demand for these commodities, and we are already planning where the puck is going. We might be early, but we think things have improved, so we’ve increased our equity exposure.
portfolios. With immigration rising and Canadian housing not keeping pace with the influx of new residents, we see the rental market as a strategic opportunity for investment for many years to come.”
Equiton partners with advisors to offer easy access to all types of investment grade real estate through our proven, high-performing investment solutions. We offer true diversification and all the benefits of real estate investing without the difficulties of financing, tenant management, building maintenance, or project management.
Find out more
In Partnership with
Real estate delivers value for ultra-high-net-worth clients
Experts share top value-add strategies and thoughts on real estate opportunities for wealthy clients
Read on
In Partnership with
Real estate delivers value for ultra-high-net-worth clients
Experts share top value-add strategies and thoughts on real estate opportunities for wealthy clients
Read on
Daniel Sacke
The Sacke Wealth Advisory Group – BMO Nesbitt Burns
Nick Maggio
Scotia Wealth Management®
Lavelle Lindo
Equiton
Cory Garlock
TD Wealth Private Investment Advice
Industry experts
Lavelle Lindo, vice president national and strategic relationships, has spent his 20+ year career developing, building, and growing strategic relationships within the financial services industry. He has a proven track record of onboarding and partnering with advisors to create lasting relationships. His deep experience with asset managers, independent wealth managers, and some of Canada’s biggest banks extends from front-line client-facing roles to senior management. Trust, integrity, and giving back to the community are cornerstones of partnership development for Lindo. At Equiton, he is responsible for growing and maintaining strategic corporate relationships.
VP National & Strategic Relationships
Equiton
Lavelle Lindo
Maggio joined ScotiaMcLeod in 2000, having worked in the financial services industry since 1984. A member of ScotiaMcLeod’s prestigious Chairman’s Council, he focuses on overseeing the analysis and implementation of holistic wealth management solutions for his clients. Maggio also offers discretionary portfolio management to clients looking to hand over the investment decision-making reins to a licensed professional. He ensures his team provides the highest level of service to clients. Maggio and his wife, Florence, enjoy travelling, the theatre, and discovering the various cuisines that the city has to offer. In his spare time, he can be found on the golf course.
Senior Wealth Advisor & Portfolio Manager
Scotia Wealth Management®
Nick Maggio, CIM, PFP
Daniel Sacke leads The Sacke Wealth Advisory Group, offering full-service, inter-generational, and bespoke wealth management. Sacke builds relationships with affluent clients and takes pride in his team’s very high client satisfaction scores. He holds the Chartered Investment Manager (CIM), Certified Financial Planner (CFP), Portfolio Manager, and Certified Seniors Advisor (CSA) designations. With over 25 years at BMO, he is a Chairmen’s Council member and recipient of the coveted Dean Nesbitt Award. Sacke and his wife have a son who performs internationally as an operatic tenor, and two daughters, both of whom study at the University of Toronto. He has completed the New York City Marathon three times and applies the same determination and grit to his professional career.
Portfolio Manager, Senior Investment Advisor
The Sacke Wealth Advisory Group – BMO Nesbitt Burns
Daniel Sacke, | B.Comm, PFP, CFP, CSA®, CIM
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Garlock is an accomplished investment advisor who holds the official designations of Certified Financial Planner (CFP®), Personal Financial Planner (PFP®), Chartered Investment Manager (CIM®), and Fellow of Canadian Securities Institute (FCSI®). He complements his education with 18 years of financial industry experience, across three national investment firms, in wealth management roles. Investing his clients’ portfolios in solutions they understand and educating clients in plain language, without using industry jargon, are two principles that Garlock hangs his hat on. He also believes that financial planning is an integral part of the puzzle, so that he can advise in all matters important to his clients.
Senior Investment Advisor
TD Wealth Private Investment Advice
Cory Garlock
Looking ahead
Published 24 July 2023
Peter G. Volpé
Scotia Wealth Management®
Daniel Sacke
The Sacke Wealth Advisory Group – BMO Nesbitt Burns
Lavelle Lindo
Equiton
Cory Garlock
TD Wealth Private Investment Advice
Nick Maggio
Scotia Wealth Management®
Brendan O’Donnell
LIBERTY NETWORK SERVICES
Bernadette Christie-David
ATELIER WEALTH
David August
INITIAL FINANCE
Industry experts
Garlock is an accomplished investment advisor who holds the official designations of Certified Financial Planner (CFP), Personal Financial Planner (PFP), Chartered Investment Manager (CIM), and Fellow of Canadian Securities Institute (FCSI). He complements his education with 18 years of financial industry experience, across three national investment firms, in wealth management roles. Investing his clients' portfolios in solutions they understand and educating clients in plain language, without using industry jargon, are two principles that Garlock hangs his hat on. He also believes that financial planning is an integral part of the puzzle, so that he can advise in all matters important to his clients.
Senior Investment Advisor
TD Wealth Private Investment Advice
Cory Garlock
Maggio joined ScotiaMcLeod in 2000, having worked in the financial services industry since 1984. A member of ScotiaMcLeod’s prestigious Chairman’s Council, he focuses on overseeing the analysis and implementation of holistic wealth management solutions for his clients. Maggio also offers discretionary portfolio management to clients looking to hand over the investment decision-making reins to a licensed professional. He ensures his team provides the highest level of service to clients. Maggio and his wife, Florence, enjoy travelling, the theatre, and discovering the various cuisines that the city has to offer. In his spare time, he can be found on the golf course.
Senior Wealth Advisor & Portfolio Manager
Scotia Wealth Management®
Nick Maggio, CIM, PFP
Lavelle Lindo, vice president national and strategic relationships, has spent his 20+ year career developing, building, and growing strategic relationships within the financial services industry. He has a proven track record of onboarding and partnering with advisors to create lasting relationships. His deep experience with asset managers, independent wealth managers, and some of Canada’s biggest banks extends from front-line client-facing roles to senior management. Trust, integrity, and giving back to the community are cornerstones of partnership development for Lindo. At Equiton, he is responsible for growing and maintaining strategic corporate relationships.
VP National & Strategic Relationships
Equiton
Lavelle Lindo
Daniel Sacke leads The Sacke Wealth Advisory Group, offering full-service, intergenerational, and bespoke wealth management. Sacke builds relationships with affluent clients and takes pride in his team’s very high client satisfaction scores. He holds the Chartered Investment Manager (CIM), Certified Financial Planner (CFP), Portfolio Manager, and Certified Seniors Advisor (CSA) designations. With over 25 years at BMO, he is a Chairmen’s Council member and recipient of the coveted Dean Nesbitt Award. Sacke and his wife have a son who performs internationally as an operatic tenor, and two daughters, both of whom study at the University of Toronto. He has completed the New York City Marathon three times and applies the same determination and grit to his professional career.
Portfolio Manager, Senior Investment Advisor
The Sacke Wealth Advisory Group – BMO Nesbitt Burns
Daniel Sacke, | B.Comm, PFP, CFP, CSA®, CIM
Peter Volpé has been successfully advising Canadians on financial planning and investment management for more than 25 years. He was among the first to receive the Chartered Financial Planner, Registered Financial Planner, and Certified Financial Planner designations from the Financial Planners Standards Council of Canada (now FP Canada). He served as chairman of FPSC for several years. He was awarded the FP Canada Fellow distinction for contributions to the profession. Volpé has delivered many investment and retirement seminars, and is a popular speaker at conferences. He has appeared frequently on television and radio, has written numerous articles, and has served as a technical editor for several books. He chairs the board of the Canadian Institute of Financial Planners, and splits his time between Toronto and Vancouver.
Fellow of FP Canada, Senior Wealth Advisor
Scotia Wealth Management®
Peter G. Volpé, CFP, FCSI
Equiton owns 35 properties in 17 communities
“I personally focus on wealth preservation, minimizing the downside, and that to me trumps earning high returns”
cory garlock,
TD wealth
“Given where inflation is, we're focusing on bank structured notes that provide exceptional interest rates”
Nick Maggio,
Scotia Wealth Management®
Equiton has over $930 million of assets under management
Investment strategies
Top considerations
To consider the challenges and opportunities, several leading industry experts gathered to discuss their thoughts on the economy, and how they’re positioning portfolios to mitigate risks and create rewards.
In an exclusive roundtable discussion with Wealth Professional in partnership with Equiton, host James Burton was joined by Cory Garlock, senior investment advisor at TD Wealth Private Investment Advice; Daniel Sacke, portfolio manager and senior investment advisor at BMO Nesbitt Burns; Lavelle Lindo, VP national and strategic relationships at Equiton; Nick Maggio, portfolio manager and senior wealth advisor at Scotia Wealth Management; and Peter Volpé, senior wealth advisor at Scotia Wealth Management.
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Daniel Sacke leads The Sacke Wealth Advisory Group, offering full-service, inter-generational, and bespoke wealth management. Sacke builds relationships with affluent clients and takes pride in his team’s very high client satisfaction scores. He holds the Chartered Investment Manager (CIM), Certified Financial Planner (CFP), Portfolio Manager, and Certified Seniors Advisor (CSA) designations. With over 25 years at BMO, he is a Chairmen’s Council member and recipient of the coveted Dean Nesbitt Award. Sacke and his wife have a son who performs internationally as an operatic tenor, and two daughters, both of whom study at the University of Toronto. He has completed the New York City Marathon three times and applies the same determination and grit to his professional career.
Portfolio Manager, Senior Investment Advisor
The Sacke Wealth Advisory Group – BMO Nesbitt Burns
Daniel Sacke, | B.Comm, PFP, CFP, CSA®, CIM
Maggio joined ScotiaMcLeod in 2000, having worked in the financial services industry since 1984. A member of ScotiaMcLeod’s prestigious Chairman’s Council, he focuses on overseeing the analysis and implementation of holistic wealth management solutions for his clients. Maggio also offers discretionary portfolio management to clients looking to hand over the investment decision-making reins to a licensed professional. He ensures his team provides the highest level of service to clients. Maggio and his wife, Florence, enjoy travelling, the theatre, and discovering the various cuisines that the city has to offer. In his spare time, he can be found on the golf course.
Senior Wealth Advisor & Portfolio Manager
Scotia Wealth Management®
Nick Maggio, CIM, PFP
Lavelle Lindo, vice president national and strategic relationships, has spent his 20+ year career developing, building, and growing strategic relationships within the financial services industry. He has a proven track record of onboarding and partnering with advisors to create lasting relationships. His deep experience with asset managers, independent wealth managers, and some of Canada’s biggest banks extends from front-line client-facing roles to senior management. Trust, integrity, and giving back to the community are cornerstones of partnership development for Lindo. At Equiton, he is responsible for growing and maintaining strategic corporate relationships.v
VP National & Strategic Relationships
Equiton
Lavelle Lindo
Garlock is an accomplished investment advisor who holds the official designations of Certified Financial Planner (CFP®), Personal Financial Planner (PFP®), Chartered Investment Manager (CIM®), and Fellow of Canadian Securities Institute (FCSI®). He complements his education with 18 years of financial industry experience, across three national investment firms, in wealth management roles. Investing his clients’ portfolios in solutions they understand and educating clients in plain language, without using industry jargon, are two principles that Garlock hangs his hat on. He also believes that financial planning is an integral part of the puzzle, so that he can advise in all matters important to his clients.
Senior Investment Advisor
TD Wealth Private Investment Advice
Cory Garlock
Daniel Sacke
The Sacke Wealth Advisory Group – BMO Nesbitt Burns
Nick Maggio
Scotia Wealth Management®
Lavelle Lindo
Equiton
Cory Garlock
TD Wealth Private Investment Advice
Industry experts
Peter G. Volpé
Scotia Wealth Management®
Peter Volpé has been successfully advising Canadians on financial planning and investment management for more than 25 years. He was among the first to receive the Chartered Financial Planner, Registered Financial Planner, and Certified Financial Planner designations from the Financial Planners Standards Council of Canada (now FP Canada). He served as chairman of FPSC for several years. He was awarded the FP Canada Fellow distinction for contributions to the profession. Volpé has delivered many investment and retirement seminars, and is a popular speaker at conferences. He has appeared frequently on television and radio, has written numerous articles, and has served as a technical editor for several books. He chairs the board of the Canadian Institute of Financial Planners, and splits his time between Toronto and Vancouver.
Fellow of FP Canada, Senior Wealth Advisor
Scotia Wealth Management®
Peter G. Volpé, CFP, FCSI
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Peter G. Volpé
Scotia Wealth Management®
Peter Volpé has been successfully advising Canadians on financial planning and investment management for more than 25 years. He was among the first to receive the Chartered Financial Planner, Registered Financial Planner, and Certified Financial Planner designations from the Financial Planners Standards Council of Canada (now FP Canada). He served as chairman of FPSC for several years. He was awarded the FP Canada Fellow distinction for contributions to the profession. Volpé has delivered many investment and retirement seminars, and is a popular speaker at conferences. He has appeared frequently on television and radio, has written numerous articles, and has served as a technical editor for several books. He chairs the board of the Canadian Institute of Financial Planners, and splits his time between Toronto and Vancouver.
Fellow of FP Canada, Senior Wealth Advisor
Scotia Wealth Management®
Peter G. Volpé, CFP, FCSI
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Copyright © 1996-2023 KM Business Information Canada Ltd.
“Number one is liquidity,” he says. “Any time they need money for any unforeseen event, we have that liquidity. And you’d be surprised – they may need $10 million, just like that. That’s the first thing.”
For cash flow and taxation, Sacke says they use a blended portfolio that includes alternatives. “We think this is a very significant and important asset class for ultra-high-net-worth clients. Even at 30 percent of their portfolio, that’s a relatively reasonable weighting in certain cases for this asset class.”
Real estate tends to be particularly popular with ultra-wealthy clients. They are often significant real estate investors, developers, and owners in their own right. One common misconception about the real estate market, however, is that whatever’s happening with homes and office buildings is also happening in apartment buildings.
Maggio says he’s cautiously optimistic about the outlook, citing concerns with the possibility of higher oil prices, which could revive inflation. “I’ll remain cautiously optimistic, and have 60 percent in equity, 10 percent into the sleeve of alts, and 30 percent in fixed income.”
Asked about his thoughts for the rest of year, Lindo says he shares the optimism of other participants on the panel.
“I’m optimistic that more investors will come to realize the value of incorporating passive private real estate into their