• Helen was running a beauty salon while studying a law degree
• Was inspired to invest in commercial property from her own experience
• She now is a buyers agent, helping others build a commercial property portfolio

As part of our ongoing series looking into key players in the real estate industry, we spoke with successful commercial property investor Helen Tarrant.

Helen Tarrant is a commercial property investor, having grown her first $10-million-plus portfolio in five years.

Combining her commercial property knowledge with her buyers agency helps replicate success for clients.

The missing portfolio piece

Ms Tarrant made an unusual start in property, while studying law and running a beauty salon.

“A very unusual combination,” she concedes, admitting she couldn’t imagine working in a restaurant during her seven-year degree.

Running the business had its challenges and taught her the importance of cash flow.

“When you are self employed, cash is king and cash flow makes the world go round.”

“Without cash flow you can’t pay your staff, buy stock and pay your rent.”

During this time, she began looking into property investment. She had accumulated a significant deposit having been working since she was 14 years old, and had purchased her first home on the Central Coast.

When delving into property investment, however, she came across the missing piece of the cash flow portfolio puzzle – commercial property.

“We get taught about growth in the property space. Everything is growth. You buy this, you wait for the equity, you spend your time slaving away for the property, servicing the mortgage, pay for the outgoings, attend to your tenant’s idiosyncrasy about a broken lightbulb.

“I had an elderly landlord that would come and collect the rent, then go off fishing for the rest of the week.”

“I realised commercial property was one of these segments people don’t talk about, and one of the areas where you couldn’t find too much information about.”

“That’s why I went down the road of commercial over residential, very counter-intuitive to the market.”

Unikorn with a ‘K’

Wanting to help others build a high growth , high yield and low risk portfolio, she started Unikorn in 2016.

“Whenever I get a client come through the door, I ask them what their ideal commercial property is,” Helen said.

She noted that many clients were typically seeking out a 10% yield property in either central Sydney or Melbourne, with development potential, all for under $ 1 million.

Helen often had to clarify that this ideal property did not exist.

“Everyone looks for the unicorn – but you need to build the unicorn. You need to build the cashflow, upsize, and grow your portfolio.”

This is why the company is called Unikorn – as it personifies what clients are looking for.

And why the letter K?

“It is 2021, you can spell it any way you want!” she says.

In terms of challenges, Helen singles out one that may seem quite counterintuitive on the surface – to actually talk clients out of deal.

“So they would go out into the market and find bright, shiny objects,” she said.

“I want to buy a Woollies or child care centre or McDonalds for a million.” was the common exchange. Helen often had to explain that these are very specialised assets, and may cost in excess of $3 million.

“And (they have) really low returns – like paying for blue-chip stocks, paying for security.”

In some cases, there is a significant shift in the balance of power to the tenant.

“You are in some ways held to ransom by your tenant. It is a very specialised asset – what else can a McDonald’s be if it is not a McDonald’s?”

“If they get up and leave, you have a worthless asset.”

“Paying metro prices for regional areas”

Helen thinks there is a lot of opportunity for commercial property over the next twelve months – but it is a double-edged sword.

“For first time Mum and Dad investors in the market, they may not understand the right returns in the market,” she explained.

“Because of that, they will pay a premium price for a return because it looks on paper higher than residential.

“I see that in auctions and EOIs (expression of interest) when they are bidding crazy amounts – they don’t know how to calculate the returns in commercial, which is different to residential.”

She noted that the other pitfall stems from areas that are growing exponentially at the moment due to the pandemic.

“We are seeing regional booms everywhere around Australia… that may not boom 3-5 years from now.”

“[The] trend is that people move to regional areas but then move back. If there is a correction in the market, people paid above market, they will lose their equity.”

Helen referred to the Perth market, noting it has witnessed a boom-and-bust cycle.

“You have seen your property prices go back ten years. In Sydney and Melbourne, people have never seen their prices go back ten years.

“So when they buy in regional, they also don’t have that same conscious [thought].”

In terms of advice for those wishing to get involved in commercial property, she says it is vital to be educated.

“Commercial property is counter-intuitive to residential property – you almost have to unlearn some of the residential stuff to learn the commercial.”

She also added it was paramount to set some long-term goals. This includes asking yourself “why you need to be in commercial?”

“What are the markers you need to hit?”

“Do you need an extra $20,000 to replace your income… an extra $50,000 to retire early, or build super?”

As a buyers agent, she believes she is there to help clients with their wealth-building pathway – not just to find a property.

While offering her services through Unikorn, Helen also offers a vast wealth of information through her website and YouTube channel.

“If you don’t have big picture goals, you won’t be able to engineer it.”