Shopping Cart  |  My Account  |  Log In


 
REIT Funding Accommodates Private REITs
4/12/2011 | By Matt Bechard
Charles Harrison, president of REIT Funding, spoke with REIT.com during REITWise 2011: NAREIT's Law, Accounting & Finance Conference in San Francisco about how his company helps manage and form private REITs. REIT Funding has provided the accommodation shareholders for approximately 900 private REITs.

"The last things our clients want to do is go out and find 100 investors to fill out the REIT shareholder requirement," Harrison said. "We also help the company manage the relationship with them and keep track of them over the years as the REIT operates."

"We'll keep track of the shareholders and answer their questions so that the REIT doesn't have to," he said.

Harrison said the company typically does a Reg-D offering to 125 shareholders at $1,000 per share. After the REIT is formed, REIT Funding will oversee dividend payments, 1099 forms and other shareholder management.

When asked about the available funding market, Harrison said that while 2007 was obviously a high point, 2008 and 2009 were the low points. However, he said that the market began to bounce back in 2010 in terms of the number of REITs his company provided shareholders for.

"It was back in the 2004 to 2005 level, which is really quite good," Harrison said. "While it may not be an exact barometer of the market, it is close. Now the numbers are getting back to the 2006 to 2007 levels."

There are two key issues that private REITs face, according to Harrison. Those issues include the Foreign Investment in U.S. Real Property Tax Act (FIRPTA) and the related issue of IRS notice 2007-55. This impacts the structure that involves a foreign investor joint venturing with a U.S. REIT and forming a domestically controlled private REIT, he said.

"A lot of work is being done now by real estate organizations to try and get Treasury to reverse 2007-55 or to get a legislative proposal. And I think progress is being made," said Harrison.

In today's market, Harrison added that the investors his company brings into private REITs are looking for dividends and diversification. On the institutional side, Harrison said the ability to appeal to foreign capital, tax-exempt foundations and others brings in a whole new source of equity for the deals they are doing.


Comments on - REIT Funding Accommodates Private REITs
No Comments To Display.
Showing 0 to 0 of 0 comments | Previous | Next
User Name:
Comment:
Enter Code: *
Thank you for your comment.

Please click here to add more comments.
Related Videos
Related Articles
More Videos from REIT.com
REITs Continue Accumulating Capital
2/16/2012 5:40
Commercial Building Owners Face Uncertain Times
2/10/2012 4:00
U.S. CRE Viewed as Stable, Secure Place to Invest
2/8/2012 3:08
January Payroll Numbers Bode Well for Industrial Sector
2/7/2012 5:46
Dividends Help REITs Outpace Market in January
2/2/2012 3:40
Dividend Growth Potential Key Part of REIT Story
1/30/2012 3:36
Multihousing Momentum to Remain Strong
1/26/2012 4:14
Looking for Low Volatility REIT Stocks
1/19/2012 4:30
Analytics Important to Energy Efficiency Efforts
1/17/2012 4:15
Federal Government Focuses on Sustainable Buildings
1/12/2012 3:45
Advertise | Contact Us | Privacy | Terms of Use
Switch To Mobile Site