Podcast - Real Estate - Key considerations when structuring property holding vehicles
This month, Christophe Kalinauckas, Group Partner at Appleby in Jersey joined Stephanie Workman, Senior Manager, Real Estate Services at Crestbridge for the latest in a series of podcasts by Crestbridge entitled Real Assets. Real Expertise.
In this podcast Christophe shares insights into the popular structures clients use for holding commercial and residential real estate.
A summary and certain highlights are as follows:
1. Introduction to the three main areas of Real Estate
a. Real estate property finance (REF) – Acquisition/development finance
b. Structuring – Formation, administration, governance and other services for property holding structures including JPUTs and REITs
c. Funds – Cross-jurisdictional advice on the full spectrum of real estate funds including the popular Jersey Private Fund (JPF)
2. Trends in the Real Estate industry
a. ESG-style focus on social justice and good governance amid a backdrop of economic uncertainty.
b. Comprehensive advice around governance – not just in theory and also in practice.
c. Asset classes expected to rise in value, and others that may see a decline.
d. The appetite of investors looking at real estate and turnaround opportunities.
3. Enforcement scenarios
a. Banks and secured parties looking at enforcement scenarios.
b. Reviews of structures and security packages, to remedy any deficiencies in advance of any enforcement action.
c. Duties of banks and secured parties looking at enforcement and potentially exercising a power of sale under the Security Interests (Jersey) Law 2012
4. REITS – Real Estate Investment Trusts
a. Globally recognised tax efficient structures for investment into UK real estate.
b. Using Crown Dependency companies to establish a REIT compared to a UK equivalent
c. The qualifying conditions in the UK Corporation Tax Act 2010 to become a REIT, including listing on a recognised stock exchange;
d. The International Stock Exchange (TISE) and the exemption of REITs from the 25% “free float” requirement
e. The process of listing REITS on TISE
f. Themes of listings and why a stock exchange listing is a mark of authenticity
g. Green market segment called TISE GREEN
5. Jersey Property Unit Trusts (JPUTS)
a. Advantages of using JPUTs as a popular vehicle for holding UK real estate
b. How to establish a JPUT, with transparency for UK income tax purposes
c. Flexibility under the Trusts (Jersey) Law 1984, and duties of the trustees of a JPUT
d. How a JPUT is operated, managed and regulated
6. Jersey Private Funds (JPFs)
a. Why the JPF is aimed at sophisticated investors within Jersey’s pragmatic regulatory environment
b. Eligibility criteria for a JPF, including categories of eligible investors
c. Applications to be submitted to the JFSC and duties of the Designated Service Provider
For more information please contact Christophe Kalinauckas, Group Partner in the corporate department.
