Mrs Smith is an investor in the Desi Place Limited Partnership. She was looking long term and wanted to be able to leave something to her three children and six grandchildren. She had $500,000 left to invest after selling her home that she and her late husband had lived in for fifty years and buying a retirement unit. Mrs Smith also has a large investment portfolio that she and her husband had accumulated during their married life. While she was attracted to the 8% p.a. pre-tax cash distribution and the tenant (she grew up in Timaru and knew the family that owned the business), she was also interested in the relatively low price for each interest of $10,000. She said that “When I fall off my perch I can leave three units or $30,000 to each grandchild, and 10 units or $100,000 to each child. That way they can all benefit when I go! And I get 8% p.a. along the way until that happens”.
*Name changed for privacy reasons