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Learn about the benefits of private wealth management

Nilo Mingrone, partner at IBC Consulting, explains that it is possible to hire asset management to administer wealth from two properties

When people read the term asset management, they think of the service provided mainly by large banks for asset and wealth management of large corporations. But what few people know is that this type of advisory service has also been provided to manage the real estate wealth of families.

And contrary to what many people think, it is not necessary to have a billionaire estate to hire this service. Nilo Mingrone, partner of IBC Consulting, a consulting company specialized in real estate business in Brazil and in the United States, informs that it is possible to perform wealth management starting from two properties. "There is no such thing as a cheap asset. From two properties, we are already dealing with a considerable value", he ponders.

Mingrone also informs that it is very common for families that own many properties to constitute a family holding to manage their assets. IBC Consulting has created an unprecedented asset management service for estates starting from R$ 1 million. "It is obvious that this structure has a cost, so it is necessary to analyze the cost-benefit not only monthly, but also throughout the life of the assets", he analyzes.

He gives an example of a family that owns two properties worth R$ 500 thousand each, one of which is for their own home and the second one with a monthly rent income of R$ 2 thousand. If this property is put into a limited company structure, it will have a monthly cost of approximately R$500 for management. However, if these properties are managed by an individual, in case of the owner's death, the inventory cost, including ITCMD - Tax on Causa Mortis Transmission and Donation of Any Goods or Rights, notary's fees, registration, lawyer, is at least 50 thousand Reais. "By constituting a family holding, the figure of the heirs ceases to exist and they become successors", he explains.

According to the entrepreneur, the real estate asset helps establish the succession planning and avoids the problems that the division of assets usually brings.

In the United States, the real estate asset counts on the figure of the trust. This is an estate manager in which, although the assets are transferred to the manager's name, he/she cannot dispose of them or put them as a guarantee for debts, and the owners remain the beneficiaries of the estate. "We are even forwarding suggestions to the Brazilian Senate so that a law can be passed to regulate the work of the trust," says Mingrone.

He explains that the trust is different from the usufruct, because in this option, the possession of the asset is transferred to the third party, while the trust performs the professional management of the assets.

Another facility pointed out by Mingrone when adopting the real estate asset is the possibility of creating a legal entity for each property belonging to the family holding, in case the partners want to get rid of one of the assets. "The advantage for the buyer is not having to spend money to deed the property," he informs.

*Nilo José Mingrone is one of the partners of IBC Consulting

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