Analysis

REIT taxation

There have been far-reaching changes to the UK REIT regime in recent years that significantly increased the attractiveness of the regime to a wider pool of property investors and providers of capital. The changes reduced barriers to both entry and investment in REITs. Now there are over 30 UK REITs.

The changes to the REIT regime benefit many

Those benefitting most significantly from the changes include:

  • Institutional investors
  • Start-up and closely held/family owned property companies
  • AIM (and overseas equivalent) traded companies
  • Offshore property companies
  • All existing and future REITs.

More details can be found in the attached summaries.

Deloitte REITs

Key benefits of REIT status

REIT status affords a number of commercial and tax benefits, including:

  • Access to the global REIT “brand”
  • Attractors of international capital
  • A liquid and publicly available source of property investment
  • Improved after-tax returns for shareholders
  • Effective elimination of latent capital gains

More details can be found in the attached summaries.

Deloitte REITs

Deloitte has been at the forefront of the UK REIT regime since its inception, working alongside Government, industry bodies and clients to shape the REIT regime.

The majority of UK REITs are Deloitte clients, including 20 of the largest REITs.

Deloitte have been involved in all recent significant REIT conversions/launches in the UK and have been heavily involved in every major REIT transaction and M&A activity in the REIT sector, including:

  • The only launches of institutional REITs
  • The only two takeovers of one REIT by another REIT
  • The largest acquisition of part of a REIT by a non-REIT
  • The largest joint ventures between REITs and non-REITs of different kinds
  • The launch of the first newly formed ‘cash’ REIT from day one
  • The first conversion of an existing offshore structure to a REIT
  • REIT rights issues and convertible bond issues
Deloitte REITs

Our multi-disciplinary team of dedicated REITs specialists is headed by Phil Nicklin who is one of the main key advisors on property tax. Phil was one of the main architects of the REIT regime and is frequently quoted in the national and property press as the UK’s pre-eminent expert on REITs. Phil also leads the Property Industry Alliance’s REITs technical group.  

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